Question

Accurate Metal Company sold 39,000 units of its product at a price of $390 per unit. Total variable cost per unit is $196, consisting of $187 in variable production cost and $9 in variable selling and administrative cost. Compute the manufacturing margin for the company under variable costing.

Answer 1

Manufacturing margin = 7566000

Step-by-step explanation:

given data

sold = 39,000 units

price = $390 per unit

Total variable cost = $196 per unit

variable production = $187

variable selling and administrative cost = $9

solution

first we get here the sales revenue that will be

sales revenue = 39000 × 390

sales revenue = 15210000

and

Cogs = 39000 × 196 = 7644000

so here Manufacturing margin will be

Manufacturing margin = 15210000 - 7644000

Manufacturing margin = 7566000