What is the total period cost for the month under the variable costing approach?

Question

What is the total period cost for the month under the variable costing approach?

  Selling price    $150.00   Units in beginning inventory    0   Units produced    3,140   Units sold    2,780   Units in ending inventory    360   Variable costs per unit:   Direct materials    $47.40   Direct labor    $57.80   Variable manufacturing overhead    $3.80   Variable selling and administrative    $11.90   Fixed costs:   Fixed manufacturing overhead    $63,742   Fixed selling and administrative    $35,862

Explanation / Answer

Units sold x (Direct materials + Direct labor + Variable manufacturing overhead + Variable selling and administrative) + Fixed manufacturing overhead + Fixed selling and administrative = 2780(47.40 + 57.80 + 3.80 + 11.90) + 63,742 + 35,862 = 435,706

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