EXERCISE 6-1 Variable and Absorption Costing Unit Product Costs (L06-1] Ida Sidha Karya Company is a family-owned company located in the village of Gianyar on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $850. Selected data for the company's operations last year follow: 0 25 Units in beginning inventory .................... Units produced ....... Units sold .......... Units in ending inventory .......... Variable costs per unit: Direct materials .......... Direct labor ..... Variable manufacturing overhead .......... Variable selling and administrative ......... Fixed costs: Fixed manufacturing overhead ................. Fixed selling and administrative ................. $100 $320 $40 $20 $60,000 $20,000 Required: Assume that the company uses absorption costing. Compute the unit product cost for one gamelan. Assume that the company uses variable costing. Compute the unit product cost for one gamelan.
Related questions
Ida Sidha Karya Company is a family-owned company located in thevillage of Gianyar on the island of Bali in Indonesia. The companyproduces a handcrafted Balinese musical instrument called a gamelanthat is similar to a xylophone. The gamelans are sold for $972.Selected data for the companyâs operations last year follow: |
Units in beginning inventory | 0 | |
Units produced | 13,000 | |
Units sold | 10,000 | |
Units in ending inventory | 3,000 | |
Variable costs per unit: | ||
Direct materials | $ 230 | |
Direct labor | $ 510 | |
Variable manufacturingoverhead | $ 50 | |
Variable selling andadministrative | $ 20 | |
Fixed costs: | ||
Fixed manufacturingoverhead | $ 930,000 | |
Fixed selling andadministrative | $ 590,000 | |
Required: |
1. | Assume that the company uses absorption costing. Compute theunit product cost for one gamelan. |
2. | Assume that the company uses variable costing. Compute the unitproduct cost for one gamelan. |
Ida Sidha Karya Company is a family-owned company located in thevillage of Gianyar on the island of Bali in Indonesia. The companyproduces a handcrafted Balinese musical instrument called a gamelanthat is similar to a xylophone. The gamelans are sold for $908.Selected data for the companyâs operations last year follow: |
| Units in beginninginventory | 0 | |
| Units produced | 21,000 | |
| Units sold | 19,000 | |
| Units in endinginventory | 2,000 | |
| Variable costs perunit: | ||
| Direct materials | $ 220 | |
| Direct labor | $ 460 | |
| Variable manufacturingoverhead | $ 62 | |
| Variable selling andadministrative | $ 21 | |
| Fixed costs: | ||
| Fixed manufacturingoverhead | $ 970,000 | |
| Fixed selling andadministrative | $ 830,000 | |
| Required: |
| 1. | Assume that the company uses absorption costing. Compute theunit product cost for one gamelan. |
| 2. | Assume that the company uses variable costing. Compute the unitproduct cost for one gamelan. |
