What is the unit product cost for the month under absorption costing?
A)$90 per unit
B)$74 per unit
C)$81 per unit
D)$83 per unit

Question

Quizplus · Accepted Answer

The unit product cost under absorption costing is calculated as follows:

Direct materials per unit = $20 
Direct labor per unit = $15 
Variable manufacturing overhead per unit = $8 
Fixed manufacturing overhead per unit = ($160,000 ÷ 20,000 units) = $8

Total unit product cost = $20 + $15 + $8 + $8 = $51

Adding the selling and administrative expenses per unit: 
Total unit cost = $51 + $30 = $81

Therefore, the correct answer is (C) $81 per unit.

What Is the Unit Product Cost for the Month Under