Asked by FRANCIS VENTURA on May 03, 2024
Verified
What is the unit product cost for the month under variable costing?
A) $69 per unit
B) $65 per unit
C) $85 per unit
D) $81 per unit
Unit Product Cost
The total cost to produce a single unit, including direct materials, direct labor, and allocated overhead.
Variable Costing
An accounting approach that includes only variable costs—direct materials, direct labor, and variable manufacturing overhead—in product costs, excluding fixed manufacturing overhead.
- Assess unit costs utilizing both variable and absorption costing methods.
Verified Answer
WZ
Wenting ZhangMay 05, 2024
Final Answer :
B
Explanation :
Under variable costing, only variable costs are included in the unit product cost. From the information given:
Variable manufacturing costs per unit = Direct materials + Direct labor + Variable manufacturing overhead = $40 + $10 + $15 = $65
Therefore, the unit product cost for the month under variable costing is $65 per unit.
Variable manufacturing costs per unit = Direct materials + Direct labor + Variable manufacturing overhead = $40 + $10 + $15 = $65
Therefore, the unit product cost for the month under variable costing is $65 per unit.
Explanation : 
Learning Objectives
- Assess unit costs utilizing both variable and absorption costing methods.