Question

Table shows the basic relationships among costs in Mag Company.

Sales Price	$400 per unit
Fixed Costs:
Marketing and administrative	$48,000 per period
Manufacturing overhead	$72,000 per period
Variable costs:
Marketing and administrative	$16 per unit
Manufacturing overhead	$18 per unit
Direct labour	$70 per unit
Direct materials	$120 per unit
Units produced and sold	1,200 per period

Required:
Determine each of the followign costs using the information above:

a) Variable manufacturing cost (per unit)
b) Product cost using absorption costing (per unit)
c) Cost of making and selling product (per unit)
d) Period costs for the period
e) Conversion costs
f) Contribution margin (per unit)

Answer 1