Smidt Corporation has provided the following data for its two most recent years

Question

Smidt Corporation has provided the following data for its two most recent years of operation: Manufacturing costs: Variable manufacturing cost per unit produced: Direct materials Direct labor Variable manufacturingoverhead Fixed manufacturing overhead per year 5 $140,000 Selling and administrative expenses: Variable selling and administrative expense per unit sold Fixed selling and administrative expense per year $65,000 Year 1 Year 2 0 3,000 Units in beginning inventory Units produced during the year Units sold during the year Units in ending inventory 10,000 7,000 7,000 6,000 3,000 4,000 The unit product cost under variable costing in Year 1 is closest to: $24.00 $33.00 $19.00 $38.00

Explanation / Answer

Unit product cost=(Direct materials+Direct labor+Variable manufacturing overheads)

=(9+5+5)

which is equal to

=$19(C)

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