Answer:
Unitary cost= $3.92
Explanation:
Giving the following information:
Lily produced 3200 cupcakes.
The variable cost per cupcake was $3.40.
Total fixed manufacturing costs were $1700
Under the absorption costing method, the unitary product cost is calculated using the variable cost and the fixed manufacturing costs.
Unitary cost= unitary variable cost + unitary fixed overhead
Unitary cost= 3.4 + 1,700/3,200= $3.92
Answer: $3.93
Explanation:
Given the following
Variable cost per unit = $3.40
Fixed manufacturing cost = $1700
Total Units produced=3200
Uaing absorption costing which incorporates the cost of fixed manufacturing cost of goods in the unit price of goods.
Absorption costing per unit = Variable cost per unit + fixed cost per unit
Variable cost per unit = $3.40
Fixed cost per unit = (Total manufacturing cost ÷ Total unit produced)
Fixed cost per unit = $1700 ÷ 3200 = $0.53
Absorption costing per unit = $3.40 + $0.53 = $3.93
