Dorothy Products Sells Its Products for $40 Per Unit Calculate the Product Cost Per Unit Produced Using Absorption Costing

question 123

Multiple Choice

Dorothy Products sells its products for $40 per unit. Additional data for the month of April, 2014, are as follows: $$\begin{array} { | l | r | } \hline \text { Beginning inventory } & 0 \text { units } \\\hline \text { Units produced } & 10,000 \\\hline \text { Units sold } & 8,000 \\\hline \text { Ending inventory } & 2,000 \\\hline \text { Direct materials } & \$ 5 \text { per unit } \\\hline \text { Direct labor } & \$ 4 \text { per unit } \\\hline \text { Variable manufacturing overhead } & \$ 15,000 \\\hline \text { Fixed manufacturing overhead } & \$ 20,000 \\\hline \text { Operating expenses } & \$ 30,000 \\\hline\end{array}$$ Calculate the product cost per unit produced using absorption costing.

• A) $12.50 per unit
• B) $10.50 per unit
• C) $ 9.00 per unit
• D) $ 11.00 per unit

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Definitions:

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