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XYZ Corporation began operations at the beginning of the current year. One of the company's products, a refrigeration element, sells for $185 per unit. Information
XYZ Corporation began operations at the beginning of the current year. One of the company's products, a refrigeration element, sells for $185 per unit. Information related to the current year's activities follows. Required: 1. Determine the cost of the December 31 finished-goods inventory. 2. Compute Mason's net income for the current year ended December 31 . 3. If next year's production decreases to 23,000 units and general cost behavior patterns do not change, what is the likely effect on a. The direct-labor cost of $37 per unit? Why? b. The fixed manufacturing overhead cost of $600,000 ? Why? c. The fixed selling and administrative cost of $860,000 ? Why? d. The average unit cost of production? Why? 34
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