Inventory Valuation under Absorption Costing and Variable Costing

At the end of the first year of operations, $5,500$ units remained in the finished goods inventory. The unit manufacturing costs during the year were as follows:

Direct materials

Direct labor

Fixed factory overhead

Variable factory overhead

$$30\mathrm{.}80$

$18\mathrm{.}70$

$6\mathrm{.}70$

$5\mathrm{.}90$

This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the question below.

X

Open spreadsheet

Determine the cost of the finished goods inventory reported on the balance sheet under $($a$)$ the absorption costing concept and $($b$)$ the variable costing concept.

Absorption costing

Variable costing $