Lane Company produced 50,000 units during its first year of operations and sold 47,300 at $12per unit. The company chose practical activity-at 50,000 units-to compute its predetermined overhead rate. Manufacturing costs are as follows:
Direct materials ...................$123,000
Direct labor ...........................93,000
Variable overhead ...................65,000
Fixed overhead ......................51,000
Required:
1. Calculate the cost of one unit of product under variable costing.
2. Calculate the cost of ending inventory under variable costing.