Circetrax,Inc.has provided the following financial information for the year: $$\begin{array} { | l | r | }
\hline \text { Finished Goods Inventory: } & \
\hline \text { Beginning balance, in units } & 600 \
\hline \text { Units produced } & 2800 \
\hline \text { Units sold } & 2900 \
\hline \text { Ending balance, in units } & 500 \
\hline \text { Production costs: } & \
\hline \text { Variable manufacturing costs per } & \
\text { unit } & \$ 60 \
\hline \text { Total fixed manufacturing costs } & \$ 42,000 \
\hline
\end{array}$$ What is the unit product cost for the year using absorption costing?
A)$75
B)$84
C)$130
D)$74

Question

Circetrax,Inc.has provided the following financial information for the year: $$\begin{array} { | l | r | } 
\hline \text { Finished Goods Inventory: } & \
\hline \text { Beginning balance, in units } & 600 \
\hline \text { Units produced } & 2800 \
\hline \text { Units sold } & 2900 \
\hline \text { Ending balance, in units } & 500 \
\hline \text { Production costs: } & \
\hline \text { Variable manufacturing costs per } & \
\text { unit } & \$ 60 \
\hline \text { Total fixed manufacturing costs } & \$ 42,000 \
\hline
\end{array}$$ What is the unit product cost for the year using absorption costing?
A)$75
B)$84
C)$130
D)$74

Quizplus · Accepted Answer

The unit product cost using absorption costing is calculated by dividing the total manufacturing costs by the number of units produced. The total manufacturing costs include both variable and fixed manufacturing costs. In this case, the variable manufacturing cost per unit is $60 and the total fixed manufacturing costs are $42,000. The number of units produced is 2800. Therefore, the unit product cost is ($60 x 2800 + $42,000) / 2800 = $75.

Circetrax,Inc What Is the Unit Product Cost for the Year Using