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CSecure https://newc ucation. corn flow/connect.html2isRege true&returnUrl;: htt

ID: 2542036 • Letter: C

Question

CSecure https://newc ucation. corn flow/connect.html2isRege true&returnUrl;: https%3A%2F%2Fconnect.mheducation.com%2Fpa 6 (Chapter 6) G da Sidha Karya Company is a family-owned company located in the village of Glanyar on the lsiand of Ball in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $885 20 23, 000 20,000 3,000 units in ending inventory Direct materials Direct labor Variable nanufacturing S 240 $ 438 riable selling and administrative Fixed costs Fixed manufacturing Fixed selling and administrative $930,000 $500, 000 that the company uses absorption costing Compute the unit product cost for one gamelan. (Round your intermediate calculations and final answer to the nearest whole dolar amount. 2. Assume that the company uses variable costing. Compute the unit product cost for one gamelan

Explanation / Answer

1.

2.

a.

Fixed manufacturing Overhead rate = fixed manufacturing overhead / unit produced

                                                             69000 / 300 = 230 per unit

Fixed manufacturing overhead deffered in ending inventory = ending inventory unit * fixed manufacturing overhead rate

                                                                                              30 * 230 = 6900

b.

Direct material = 140

Direct labour = 350

variable manufacturing overhead = 35

Total variable cost of sales = 525

Absortion Costing Varriable Costing Direct Material 240 240 Direct Labour 430 430 Varriable over head 55 55 Fixed Cost 930000/23000 = 40.43 unit cost 765.43 725