MC Qu. 137 Given the following data, calculate product... Given the following data, calculate product cost per unit under absorption costing. Direct labor $ 18 per unit Direct materials $ 12 per unit Overhead Total variable overhead $ 31,000 Total fixed overhead $ 101,000 Expected units to be produced 51,000 units

Total Product Costs under absorption costing per unit $ 32.59

Explanation:

Under absorption costing the fixed overheads are included in the product costs.  We calculate the total manufacturing costs having fixed overheads and variable overheads and divide it with the number of units to get the product cost per unit.

Expected units to be produced 51,000 units

Direct materials $ 12 * 51,000= $ 612000

Direct labor $ 18 per unit * 51,000= $918000

Overhead

Total variable overhead $ 31,000

Total fixed overhead $ 101,000

Total Manufacturing Costs $1662000

Total Manufacturing Costs per unit = Total Costs/ Total units= $1662000 / 51000= $ 32.59

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