A manufacturing company, Exeter Corporation produces a single product with a selling price of $74 per unit, the following data regarding it’s operation in the current years is available : Units in Beginning Inventory in Year 1 0 units Units produced in Year 1 23,000 units Units sold in Year 1 19, 500 units Units produced in Year 2 20,000 units Units sold in Year 2 22,000 units Variable costs of the company during Year 1 operations : DM $33 DL $11 MOH $3.5 Selling & Admin $8.70 Fixed costs of the company during Year 1 operations : Selling & Admin expenses $85,000 Manufacturing Overheads $250,000 Variable costs of the company during Year 2 operations : DM $33.75 DL $12 MOH $3.5 Selling & Admin $9 Fixed costs of the company during Year 2 operations : Selling & Admin expenses $85,000 Manufacturing Overheads $250,000 Required: a. Calculate the product cost per unit for Year 1 and Year 2, under the Absorption Costing System.
A manufacturing company, Exeter Corporation produces a single product with a selling price of
$74 per unit, the following data regarding it’s operation in the current years is available :
Units in Beginning Inventory in Year 1 0 units
Units produced in Year 1 23,000 units
Units sold in Year 1 19, 500 units
Units produced in Year 2 20,000 units
Units sold in Year 2 22,000 units
Variable costs of the company during Year 1 operations :
DM $33
DL $11
MOH $3.5
Selling & Admin $8.70
Fixed costs of the company during Year 1 operations :
Selling & Admin expenses $85,000
Manufacturing Overheads $250,000
Variable costs of the company during Year 2 operations :
DM $33.75
DL $12
MOH $3.5
Selling & Admin $9
Fixed costs of the company during Year 2 operations :
Selling & Admin expenses $85,000
Manufacturing Overheads $250,000
Required:
a. Calculate the product cost per unit for Year 1 and Year 2, under the Absorption Costing System.
![](/static/compass_v2/shared-icons/check-mark.png)
Step by step
Solved in 2 steps with 2 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![FINANCIAL ACCOUNTING](https://compass-isbn-assets.s3.amazonaws.com/isbn_cover_images/9781259964947/9781259964947_smallCoverImage.jpg)
![Accounting](https://www.bartleby.com/isbn_cover_images/9781337272094/9781337272094_smallCoverImage.gif)
![Accounting Information Systems](https://www.bartleby.com/isbn_cover_images/9781337619202/9781337619202_smallCoverImage.gif)
![Horngren's Cost Accounting: A Managerial Emphasis…](https://www.bartleby.com/isbn_cover_images/9780134475585/9780134475585_smallCoverImage.gif)
![Intermediate Accounting](https://www.bartleby.com/isbn_cover_images/9781259722660/9781259722660_smallCoverImage.gif)
![Financial and Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781259726705/9781259726705_smallCoverImage.gif)