Variable Costing, Value of Ending Inventory, Operating Income

Pattison Products, Inc., began operations in October and manufactured 49,000 units during the month with the following unit costs:

Direct materials	$4.50
Direct labor	2.50
Variable overhead	1.25
Fixed overhead*	6.50
Variable marketing cost	0.95

^* Fixed overhead per unit = $318,500 / 49,000 units produced = $6.50

Total fixed factory overhead is $318,500 per month. During October, 48,000 units were sold at a price of $24.75, and fixed marketing and administrative expenses were $118,500.

Required:

1. Calculate the cost of each unit using variable costing. Round your final answer to the nearest cent.

$ per unit

2. How many units remain in ending inventory? units

What is the cost of ending inventory using variable costing?

3. Prepare a variable-costing income statement for Pattison Products, Inc., for the month of October.

Pattison Products, Inc.
Variable-Costing Income Statement
For the Month of October
	$
Less:
Contribution margin	$
Less:
Operating income	$

4. What if November production was 49,000 units, costs were stable, and sales were 50,000 units? What is the cost of ending inventory? If an amount is zero, enter "0". $

What is operating income for November? $