A manufacturing company has provided the following data concerning its most rece

Question

A manufacturing company has provided the following data concerning its most recent month of operations:

Selling price $133

Units in beginning inventory 0
Units produced 7,000
Units sold 6,800
Units in ending inventory 200

Variable costs per unit:
Direct materials $41
Direct labor 57
Variable manufacturing overhead 5
Variable selling and administrative 4

Fixed costs:
Fixed manufacturing overhead $133,000
Fixed selling and adminstrative 34,000

What is the total period cost for the month under the absorption costing approach?
a. $61,200
b. $133,000
c. $34,000
d. $194,200

Explanation / Answer

Period Cost = Fixed Selling and Administrative Expenses + Variable Selling and Administrative Expenses = 34000 + 4*6800 = 61200

Option A (61200) is correct.

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.