Castaway Company Reports the Following First Year Production Cost Information

question 59

Essay

Castaway Company reports the following first year production cost information. $$\begin{array} { l l } \text { Units produced } & 53,000 \text { units } \\\text { Units sold } & 51,000 \text { units } \\\text { Direct labor } & \$ 8 \text { per unit } \\\text { Direct materials } & \$ 4 \text { per unit } \\\text { Variable overhead } & \$ 2,173,000 \text { in total } \\\text { Fixed overhead } & \$ 3,339,000 \text { in total }\end{array}$$
(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:

Limited Partnership

A form of partnership consisting of one or more general partners who manage the business and are personally liable for its debts, and one or more limited partners who invest capital but have limited liability and do not participate in management.

Unincorporated Business Association

A business entity where two or more persons come together for a commercial purpose without forming a corporation.

Dormant Partner

A business partner who does not participate in the day-to-day management of the partnership but still shares in its profits and losses.

Limited Partner

An investor in a partnership who has limited liability to the extent of their investment in the company and does not participate in daily business operations.