Exercise $7-1($Algo$)$ Variable and Absorption Costing Unit Product Costs $[$LO$7-1]$

Ida Company produces a handcrafted musical instrument called a gamelan that is similar to a xylophone. The gamelans are sold for $$903.$ Selected data for the company$$s operations last year follow:

Units in beginning inventory $0$

Units produced $16,000$

Units sold $14,000$

Units in ending inventory $2,000$

Variable costs per unit:

Direct materials $ $210$

Direct labor $ $480$

Variable manufacturing overhead $ $65$

Variable selling and administrative $ $23$

Fixed costs:

Fixed manufacturing overhead $ $600,000$

Fixed selling and administrative $ $430,000$

Required:

$1.$ Assume that the company uses absorption costing. Compute the unit product cost for one gamelan. $($Round your intermediate calculations and final answer to the nearest whole dollar amount.$)$

$2.$ Assume that the company uses variable costing. Compute the unit product cost for one gamelan.Exercise $7-1($Algo$)$ Variable and Absorption Costing Unit

Product Costs $[$L$07-1]$

Ida Company produces a handcrafted musical instrument called a gamelan that

is similar to a xylophone. The gamelans are sold for $$903.$ Selected data for the

company's operations last year follow:

Required:

Assume that the company uses absorption costing. Compute the unit product

cost for one gamelan. $($Round your intermediate calculations and final answer

to the nearest whole dollar amount.$)$

Assume that the company uses variable costing. Compute the unit product

cost for one gamelan.

Absorption costing unit product cost

Variable costing unit product cost