Beamish Inc., which produces a single product, has provided the following data for its most recent month of operations: There were no beginning or ending inventories.The absorption costing unit product cost was:
A)$93 per unit
B)$97 per unit
C)$136 per unit
D)$194 per unit

Question

Beamish Inc., which produces a single product, has provided the following data for its most recent month of operations:  There were no beginning or ending inventories.The absorption costing unit product cost was:
A)$93 per unit 
B)$97 per unit 
C)$136 per unit 
D)$194 per unit

Quizplus · Accepted Answer

To calculate the absorption costing unit product cost, we need to calculate the total manufacturing cost per unit and divide it by the total units produced.

Total manufacturing cost per unit:

Direct materials: $42
Direct labor: $22
Variable manufacturing overhead: $10
Fixed manufacturing overhead: $62,000 / 2,000 units = $31

Total manufacturing cost per unit = $42 + $22 + $10 + $31 = $105

Total units produced = 1,200

Absorption costing unit product cost = Total manufacturing cost per unit / Total units produced = $105 / 1,200 = $136 per unit.

Therefore, the correct answer is C. 11ea7998_5dad_269c_911b_eb02e92c35d6_TB2627_00_TB2627_00