Question

ABC Industries manufactured 2400 units of its product Huge in the month of April. It incurred a total cost of $132,000 during the month. Out of this $132,000, $45,700 comprised of direct materials used in the product and the rest was incurred because of the conversion cost involved in the process. It had no opening or closing inventory. What will be the total cost per unit of the product, assuming conversion costs contained $10,000 of indirect labor

Answer 1

Unitary cost= $55

Step-by-step explanation:

Giving the following information:

Total number of units manufactured= 2,400

Total cost incurred in production= $132,000

Beginning inventory= 0

Ending inventory= 0

To calculate the unitary cost, we need to use the following formula:

Unitary cost= total cost / units manufactured

Unitary cost= 132,000 / 2,400

Unitary cost= $55