Question

Sea Company reports the following information regarding its production costs: Units produced 42,000 units Direct labor $ 35 per unit Direct materials $ 28 per unit Variable overhead $ 17 per unit Fixed overhead $ 105,000 in total Compute the product cost per unit under absorption costing.

Answer 1

Answer:

$80

Explanation:

Data provided

Direct labor = $35 per unit

Direct materials = $28 per unit

Variable overhead = $17 per unit

The computation of the cost per unit under absorption costing is shown below:-

Cost per unit under absorption costing = Direct labor + Direct materials + Variable overhead

= $35 + $28 + $17

= $80

Therefore, for computing the Cost per unit under absorption costing we simply add the direct labor, direct material and variable overhead.