Home Base,Inc ACompute Production Cost Per Unit Under Variable Costing

question 117

Essay

Home Base,Inc.reports the following production cost information:
$$\begin{array} { l l } \text { Units produced } & 97,000 \text { units } \\\text { Units sold } & 92,000 \text { units } \\\text { Direct labor } & \$ 17 \text { per unit } \\\text { Direct materials } & \$ 34 \text { per unit } \\\text { Variable overhead } & \$ 2,522,000 \text { in total } \\\text { Fixed overhead } & \$ 1,940,000 \text { in total }\end{array}$$
a.Compute production cost per unit under variable costing.
b.Compute production cost per unit under absorption costing.
c.Determine the cost of ending inventory using variable costing.
d.Determine the cost of ending inventory using absorption costing.

---

Definitions:

Required Return

The minimum rate of return an investor expects to receive from an investment, taking into account the investment's risk level.

Initial Cost

The acquisition cost of an asset or investment, including purchase price and any initial setup fees, before any deductions or depreciation.

Annual Cash Flows

The total amount of money being transferred in and out of a business over a year, used to assess the financial health of a business.