Assume a Company Had the Following Production Costs Under Absorption Costing, the Total Production Cost Per Unit When

question 175

True/False

Assume a company had the following production costs:
$\begin{array}{ll} \text { Direect labor } &\$ 20,000 \\ \text { Direct material } &\$ 30,000 \\ \text { Variable overhead } &\$ 40,000 \\ \text { Fixed overhead } &\$ 50,000\end{array}$ Under absorption costing, the total production cost per unit when 4,000 units are produced would be $22.50.

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Definitions:

Trial Balance

A financial report that lists the balances of all ledgers in an account to check the mathematical accuracy of bookkeeping entries.

Cash Salary

Compensation for services rendered by an employee or contractor that is paid in the form of immediately available funds rather than non-cash benefits.

Accounts Receivable

Funds owed to a company by customers who have purchased goods or services on credit.

Office Supplies

Items used in offices on a regular basis for the purpose of carrying out tasks; includes items like pens, paper, and staplers.