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Vega Enterprises has computed the following unit costs for the year just ended:
Direct material used $12
Direct labor 18
Variable manufacturing overhead 25
Fixed manufacturing overhead 29
Variable selling and administrative cost 10
Fixed selling and administrative cost 17

Under absorption costing, each unit of the company's inventory would be carried at:

a) $35. b) $55. c) $65. d) $84.

Respuesta :

Answer:

d) $84.

Explanation:

The computation of the company inventory using the absorption costing is shown below:

= Direct material cost per unit + Direct labor per unit + Variable manufacturing overhead per unit + Fixed manufacturing overhead per unit

= $12 per unit + $18 per unit + $25 per unit + $29 per unit

= $84 per unit

Therefore, the Variable selling and administrative cost per unit and the Fixed selling and administrative cost is ignored

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