Sequoyah, Inc What Is the Unit Product Cost Using Variable Costing?
A)

question 29

Multiple Choice

Sequoyah, Inc. reports the following information: $$\begin{array} { | l | r | l | } \hline \text { Units produced } & 540 & \text { units } \\\hline \text { Units sold } & 540 & \text { units } \\\hline \text { Sales price } & \$ 160 & \text { per unit } \\\hline \text { Direct materials } & \$ 30 & \text { per unit } \\\hline \text { Direct labor } & \$ 15 & \text { per unit } \\\hline \text { Variable manufacturing overhead } & \$ 10 & \text { per unit } \\\hline \text { Fixed manufacturing overhead } & \$ 20,000 & \text { per year } \\\hline \text { Variable selling and administrative costs } & \$ 5 & \text { per unit } \\\hline \text { Fixed selling and administrative costs } & \$ 10,000 & \text { per year } \\\hline\end{array}$$ What is the unit product cost using variable costing?

• A) $60
• B) $82
• C) $55
• D) $105

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Definitions:

Financial Statements

Formal records of the financial activities and position of a business, person, or other entity, which typically includes the balance sheet, income statement, and cash flow statement.

Not-for-profit Organizations

Entities that operate for purposes other than generating profit, focusing instead on public or social objectives.

External Reporting

refers to the process of preparing and disclosing financial statements and other information to outside users such as investors, creditors, and regulatory agencies.

Amortization Period

The length of time over which the principal and interest of a loan or mortgage are scheduled to be paid down to zero.