question archive Fresh Air Products manufactures and sells a variety of camping products
Fresh Air Products manufactures and sells a variety of camping products
Subject:AccountingPrice:2.87 Bought7
Fresh Air Products manufactures and sells a variety of camping products. Recently the company opened a new plant to manufacture a deluxe portable cooking unit. Cost and sales data for the first month of operations are shown below:
Beginning inventory 0 units
Units produced 10,700
Units sold 8,900
Manufacturing costs
Fixed overhead $128,400
Variable overhead $6 per unit
Direct labour $12 per unit
Direct material $25 per unit
Selling and administrative costs
Fixed $207,400
Variable $4 per unit sold
The portable cooking unit sells for $110. Management is interested in the opening month’s results and has asked for an income statement. Assuming the company uses absorption costing: (a)
a) Calculate the manufacturing cost per unit.
Option 1
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