Amarantha Corp Calculate the Unit Product Cost Using Absorption Costing and Variable

question 164

Essay

Amarantha Corp.has provided the following data for the current year.
$$\begin{array} { | l | r | } \hline \text { Units produced } & 2,500 \text { units } \\\hline \text { Sales price } & \$ 200 \text { per unit } \\\hline \text { Direct materials } & \$ 75 \text { per unit } \\\hline \text { Direct labor } & \$ 65 \text { per unit } \\\hline \text { Variable manufacturing overhead } & \$ 25 \text { per unit } \\\hline \text { Fixed manufacturing overhead } & \$ 225,000 \text { per year } \\\hline \text { Variable selling and administrative costs } & \$ 30 \text { per unit } \\\hline \text { Fixed selling and administrative costs } & \$ 150,000 \text { per year } \\\hline\end{array}$$ Calculate the unit product cost using absorption costing and variable costing.

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Definitions:

Surety

A person or entity that takes responsibility for another's performance of an undertaking, for example, the payment of a debt.

Guarantor

A guarantor is an individual or entity that promises to repay a loan or fulfill an obligation if the original debtor fails to do so.

Equitable Redemption

is a legal principle allowing a mortgagor in default the right to redeem or reclaim their property by paying off the entire mortgage debt before a foreclosure sale.

Lender

An individual, organization, or entity that provides funds to another with the expectation of repayment plus interest.