Question

Concord Corporation sells its product for $50 per unit. During 2019, it produced 60000 units and sold 50000 units (there was no beginning inventory). Costs per unit are: direct materials $9, direct labor $11, and variable overhead $4. Fixed costs are: $720000 manufacturing overhead, and $90000 selling and administrative expenses. The per unit manufacturing cost under absorption costing is $36. $38. $24. $20.

Answer 1

unitary manufacturing cost= $36

Step-by-step explanation:

The absorption costing method includes all costs related to production, both fixed and variable. The unit product cost is calculated using direct material, direct labor, and total unitary manufacturing overhead.

First, we need to calculate the unitary fixed manufacturing overhead:

unitary fixed manufacturing overhead= 720,000 / 60,000

unitary fixed manufacturing overhead= $12

Now, we can determine the unitary manufacturing cost:

unitary manufacturing cost= 9 + 11 + 4 + 12

unitary manufacturing cost= $36