Williamson, Inc., manufactures digital voice recorders. During 2016, total costs associated with manufacturing 202,500 of the new EZ 9900 model (introduced this year) were as follows:

Raw materials	$	1,780,200
Direct labor		2,959,800
Variable manufacturing overhead		752,200
Fixed manufacturing overhead		706,900

Required:

a. Calculate the cost per recorder under both variable costing and absorption costing. (Round your answers to 2 decimal places.)

	Cost per recorder
Variable costing		each
Absorption costing		each

b. If 20,230 of these recorders were in finished goods inventory at the end of 2016, by how much and in what direction (higher or lower) would 2016 cost of goods sold and operating income be different under variable costing than under absorption costing? (Round your intermediate calculations to 2 decimal places and final answer to the whole number.)

Total fixed cost associated with ending inventory

Under variable costing, the cost of goods sold would be

than under absorption costing.

c-1. Express the digital voice recorder cost in a cost formula. (Round your answers to 2 decimal places.)

Total cost =

+

per digital voice recorder produced.

c-2. What does this formula suggest the total cost of making an additional 1,750 recorders would be?

Total additional cost