Hansard Company produced 39,410 units during its first year of operations and so

Question

Hansard Company produced 39,410 units during its first year of operations and sold 38,904 at $17 per unit. The company chose practical activity—at 39,410 units—to compute its predetermined overhead rate. Manufacturing costs are as follows:

Required:

1. Calculate the unit cost for each of these four costs. Round your answers to the nearest cent.

2. Calculate the cost of one unit of product under absorption costing. Round your answer to the nearest cent.
$per unit

3. How many units are in ending inventory?
units

4. Calculate the cost of ending inventory under absorption costing. Round your answer to the nearest dollar.
$

Direct materials $81,800 Direct labor 101,300 Variable overhead 15,600 Fixed overhead 50,700

Explanation / Answer

Answer to 1 and 2

Answer to 3 and 4

Particulars Amt (A) No of Units (B) Per Unit (A/B) Direct materials      81,800.00    39,410.00                     2.08 Direct labor    101,300.00    39,410.00                     2.57 Variable overhead      15,600.00    39,410.00                     0.40 Fixed overhead      50,700.00    39,410.00                     1.29 Total Cost $249,400                     6.33

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