Question

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: Selling price $ 150 Units in beginning inventory 150 Units produced 7,300 Units sold 6,900 Units in ending inventory 550 Variable costs per unit: Direct materials $ 48 Direct labor $ 43 Variable manufacturing overhead $ 8 Variable selling and administrative expense $ 4 Fixed costs: Fixed manufacturing overhead $ 233,600 Fixed selling and administrative expense $ 82,800 What is the total period cost for the month under variable costing

Answer 1

$ 344,000

Step-by-step explanation:

Given

Selling price $150

Units in beginning inventory 150

Units produced 7,300

Units sold 6,900

Units in ending inventory 550

Variable cost per unit:

Direct materials $48

Direct labor $43

Variable manufacturing overhead $8

Variable selling and administrative $4

Fixed costs:

Fixed manufacturing overhead $233,600

Fixed selling and administrative $82,800

To determine total period cost for the month under variable costing

We first calculate the variable selling and administrative expense and add together

=

$4 per unit × 6,900 units sold = $ 27,600

Fixed manufacturing overhead 233,600

Fixed selling and administrative 82,800

27,600 + 82,800 + 233,600

Therefoee variable costing total period cost for the month

= $ 344,000