Figure 5-10.The King Corporation manufactures custom-made furniture. The following data pertains to Job X4A:
Plantwide overhead rate is $22.50 per machine hour.
-Refer to Figure 5-10. Job X4A consists of 500 units. One-half of Job X4A was sold for $10,000. What is the cost per unit for Job X4A?

Question

Figure 5-10.The King Corporation manufactures custom-made furniture. The following data pertains to Job X4A:
  Plantwide overhead rate is $22.50 per machine hour.
-Refer to Figure 5-10. Job X4A consists of 500 units. One-half of Job X4A was sold for $10,000. What is the cost per unit for Job X4A?

Quizplus · Accepted Answer

The total cost of Job X4A is $15,750 (500 units x $31.50 per unit). One-half of the job was sold for $10,000, which means that the remaining half of the job is still in inventory and has a cost of $7,875 (1/2 x $15,750). Therefore, the cost per unit for Job X4A is $31.50 ($7,875 / 250 units).