Question

A manufacturing company that produces a single product has provided the following data concerning its most recent month of operations: Selling price $ 166 Units in beginning inventory 100 Units produced 9,300 Units sold 8,800 Units in ending inventory 600 Variable costs per unit: Direct materials $ 48 Direct labor $ 42 Variable manufacturing overhead $ 12 Variable selling and administrative expense $ 9 Fixed costs: Fixed manufacturing overhead $297,600 Fixed selling and administrative expense $176,000 What is the total period cost for the month under variable costing

Answer 1

Answer:

$552,800

Explanation:

The computation of the total period costing under variable costing is shown below:

As we know that

Period Cost = Total Variable Selling and Administrative Cost + Fixed Manufacturing Overhead + Fixed Selling and Administrative Cost

where,

Total Variable Selling and Administrative Cost is

=  Variable Selling and Administrative per unit × Unit Sold

=  $9 × 8,800

= $79,200

The fixed manufacturing overhead is $297,600

And, the fixed selling and admin cost is $176,000

So, the total period cost is

= $79,200 + $297,600 + $176,000

= $552,800