Baughn Corporation, which has only one product, has provided the following data concerning its most recent month of operations: What is the unit product cost for the month under variable costing?
A) $104 per unit
B) $79 per unit
C) $88 per unit
D) $95 per unit

Question

Baughn Corporation, which has only one product, has provided the following data concerning its most recent month of operations:  What is the unit product cost for the month under variable costing?
A) $104 per unit 
B) $79 per unit 
C) $88 per unit 
D) $95 per unit

Quizplus · Accepted Answer

Under variable costing, only variable manufacturing costs are included in the unit product cost. The total variable manufacturing cost for the month is $132,000. The total number of units manufactured is 2,000. Therefore, the unit product cost for the month under variable costing is $66 ($132,000 ÷ 2,000).

Baughn Corporation, Which Has Only One Product, Has Provided the Following