Talk2Me Communications manufactures headsets to make phones hands free. In 2020, the entity produced 30000 units, of which 24000 were sold. The following costs were recorded for 2020.

Determination of the inventoriable product cost for Talk2Me Communications is relatively simple, as the entity produces only one product.

Required
(a) Identify the most appropriate costing system to value products for Talk2Me Communications’ financial statements.
(b) Calculate the inventoriable product cost.
(c) Comment on the usefulness of the inventoriable product cost for decision making.

Transcribed Image Text:

Direct material Direct labour Manufacturing overhead Selling expenses Administrative expenses $1 200 000 600 000 1 500 000 150 000 240 000