Swiatek Corporation produces a single product and has the following cost structure: The variable costing unit product cost is:
A)$161
B)$225
C)$153
D)$158

Question

Swiatek Corporation produces a single product and has the following cost structure:  The variable costing unit product cost is:
A)$161 
B)$225 
C)$153 
D)$158

Quizplus · Accepted Answer

Variable costing includes only the variable manufacturing costs in the product cost calculation. Based on the given cost structure, the variable manufacturing cost per unit is $84 ($21 + $9 + $54). Therefore, the variable costing unit product cost is calculated as follows:
Direct materials + Direct labor + Variable manufacturing overhead = $21 + $9 + $54 = $84
Adding the variable manufacturing cost of $84 to the fixed manufacturing cost per unit of $69 gives a total unit product cost of $153. Therefore, the correct choice is C.

Swiatek Corporation Produces a Single Product and Has the Following