A manufacturing company that produces a single product has provided the followin

Question

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: Selling price $177 Units in beginning inventory 100 Units produced 7,600 Units sold 7,400 Units in ending inventory 300 Variable costs per unit: Direct materials $56 Direct labor $51 Variable manufacturing overhead $12 Variable selling and administrative $8 Fixed costs: Fixed manufacturing overhead $250,800 Fixed selling and administrative $103,600 What is the total period cost for the month under variable costing?

Explanation / Answer

Period cost under Variable costing = Variable selling + Fixed maufacturing overhead + Fixed selling

                                                  = (8 *   7400 ) + 250,800 +103,600

                                                  = 59,200+ 250,800 +103,600

                                                 = $ 413,600

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