Question

g Marigold Corp. sells its product for $80 per unit. During 2019, it produced 60000 units and sold 50000 units (there was no beginning inventory). Costs per unit are: direct materials $20, direct labor $12, and variable overhead $1. Fixed costs are: $720000 manufacturing overhead, and $90000 selling and administrative expenses. The per unit manufacturing cost under variable costing is

Answer 1

Answer: $33

Step-by-step explanation:

Under the Variable Costing method, the only costs assigned to inventory are the direct costs as well as the Variable Overhead as these are all variable costs.

The other costs are then charged to an expense account.

Manufacturing cost per unit;

= Direct material + direct labour + Variable overhead

= 20 + 12 + 1

= $33