Vital Industries manufactured 1,200 units of its product Huge in the month of April.It incurred a total cost of $120,000 during the month.Out of this $120,000,$45,000 comprised of direct materials used in the product and the rest was incurred because of the conversion cost involved in the process.Ryan had no opening or closing inventory.What will be the total cost per unit of the product,assuming conversion costs contained $10,000 of indirect labor?

Question

Quizplus · Accepted Answer

The total cost per unit is calculated by dividing the total cost by the number of units produced. Total cost is $120,000 for 1,200 units, so the cost per unit is $120,000 / 1,200 = $100.

Vital Industries Manufactured 1,200 Units of Its Product Huge in the Month