Question - Unit Cost, No Work-In-Process Inventories
Lising Therapy has a physical therapist who performs electro-mechanical treatments for its patients. During April, Lising had the following cost and output information:
Direct materials $900
Hygienist's salary $4,100
Overhead $7,000
Number of treatments 100
Required:
1. Calculate the cost per treatment for April.
2. Calculate the cost of services sold for April.
3. What if Lising found a way to reduce overhead costs by 30 percent? How would this affect the profit per treatment?