Dallavalle Corporation Manufactures and Sells One Product

question 10

Multiple Choice

Dallavalle Corporation manufactures and sells one product. The following information pertains to the company's first year of operations: The company does not have any variable manufacturing overhead costs or variable selling and administrative expenses. During its first year of operations, the company produced 32,000 units and sold 31,000 units. The company's only product is sold for $238 per unit.Assume that the company uses a variable costing system that assigns $10 of direct labor cost to each unit that is produced. The unit product cost under this costing system is:

• A) $170 per unit
• B) $214 per unit
• C) $93 per unit
• D) $103 per unit

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Definitions:

Financial Statements

Official documentation of a business, individual, or entity's financial condition and operations, normally comprising the income statement, balance sheet, and statement of cash flows.

Statement of Cash Flows

A financial statement that shows how changes in balance sheet accounts and income affect cash and cash equivalents, dividing activities into operating, investing, and financing.

Statement of Stockholders' Equity

A financial statement that shows changes in the value of a company’s equity over a specified period.

Income Statement

The income statement is a financial document that reports a company's financial performance over a particular period, showing revenues, expenses, and net income or loss.