Assignment:
Provide appropriate supporting analysis for your answer choice.
Abbey Company, which has only one product, has provided the following data concerning its most recent month of operations:
Selling price $129
Units in beginning inventory 0
Units produced 6,300
Units sold 6,100
Units in ending inventory 200
Variable costs per unit:
Direct materials $32
Direct labor $50
Variable manufacturing overhead $5
Variable selling and administrative $11
Fixed costs:
Fixed manufacturing overhead $88,200
Fixed selling and administrative $97,600
Q1. What is the unit product cost for the month under variable costing?
A) $87
B) $101
C) $112
D) $98
Q2. What is the unit product cost for the month under absorption costing?
A) $101
B) $98
C) $87
D) $112
Q3. The total gross margin for the month under the absorption costing approach is:
A) $189,100
B) $6,100
C) $170,800
D) $191,000
Q4. What is the total period cost for the month under the variable costing approach?
A) $252,900
B) $164,700
C) $88,200
D) $185,800
Q5. What is the net operating income for the month under variable costing?
A) $3,300
B) $2,800
C) ($14,100)
D) $6,100