Cold City Blowers produces snow blowers. The selling price per snow blower is $100. Costs involved in production are: $\begin{array}{lr}
\text { Direct material per unit } & \$ 22 \
\text { Direct labor per unit } & 15 \
\text { Variable manufacturing overhead per unit } & 6 \
\text { Fixed manufacturing overhead per year } & 23,400
\end{array}$ In addition, the company has fixed selling and administrative costs of $9,360 per year. During the year, Cold City Blowers produced 780 snow blowers and sold 800 snow blowers. Beginning inventory consisted of 50 snow blowers. How much is variable cost of goods sold?

Question

Quizplus · Accepted Answer

Variable cost per unit is $43 ($22 + $15 + $6). For 800 units sold, variable cost of goods sold is 800 * $43 = $34,400.

Cold City Blowers Produces Snow Blowers In Addition, the Company Has Fixed Selling and Administrative Costs