Question

Advanced Company reports the following information for the current year. All beginning inventory amounts equaled $0 this year. Units produced this year 39,000 units Units sold this year 23,400 units Direct materials $ 23 per unit Direct labor $ 25 per unit Variable overhead $ 3 per unit Fixed overhead $ 195,000 in total Given Advanced Company's data, compute cost per unit of finished goods under absorption costing.

Answer 1

the cost per unit of finished goods under absorption costing is $56

Step-by-step explanation:

The computation of the cost per unit of finished goods under absorption costing is given below:

Direct materials $23

Direct labor $25

Variable manufacturing overhead $3

Fixed manufacturing overhead ($195.000 ÷ 39,000 units) $5

Total unit cost $56

Hence, the cost per unit of finished goods under absorption costing is $56