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Question
Home Base, Inc. reports the following production cost information:Beginning inventory 10,000 units
Units produced 97,000 units
Units sold 92,000 units
Direct labor $17 per unit
Direct materials $34 per unit
Variable overhead $2,522,000 in total
Fixed overhead $1,940,000 in total
Operating costs $2,000,000 in total
Assume that productions costs have remained the same since the previous period and all units are sold for $137.00 per unit.
a. Compute production cost per unit under variable costing.
b. Compute production cost per unit under absorption costing.
c. Determine net income using variable costing.
d. Determine net income using absorption costing.
Answer
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