Falisari Corporation has computed the following unit costs for the year just ended:
Direct material used $ 25
Direct labor 19
Variable manufacturing overhead 35
Fixed manufacturing overhead 40
Variable selling and administrative cost 17
Fixed selling and administrative cost 32
Which of the following choices correctly depicts the per-unit cost of inventory under variable costing and absorption costing?
Variable Costing Absorption Costing
A. $ 79 $ 119
B. $ 79 $ 151
C. $ 96 $ 119
D. $ 96 $ 151
E. None of the answers is correct.

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abiolataiwo2015 abiolataiwo2015 · Answer 1 · 2021-02-23T01:02:32+01:00

Answer:

A. $ 79 $ 119

Explanation:

Calculation for the choices that correctly depicts the per-unit cost of inventory under variable costing and absorption costing

Calculation for Variable costing using this formula

Variable costing = Direct materials + Direct labor + Variable Manufacturing Overhead

Let plug in the formula

Variable costing = = $25 + $19 + $35

Variable costing = $79

Calculation for Absorption costing using this formula

Absorption costing = Direct materials + Direct labor + Variable Manufacturing Overhead + Fixed Manufacturing Overhead

Let plug in the formula

Absorption costing= $25 + $19 + $35 + $40

Absorption costing= $119

Therefore the choices that correctly depicts the per-unit cost of inventory under variable costing and absorption costing are :$ 79 $ 119