Unit Costs, Inventory Valuation, Variable and Absorption Costing

Snyder Company produced 81,600 units during its first year of operations and sold 79,200 at $22.15 per unit. The company chose practical activityat 81,600 unitsto compute its predetermined overhead rate. Manufacturing costs are as follows:

Direct materials	$478,176
Direct labor	121,584
Expected and actual variable overhead	338,640
Expected and actual fixed overhead	423,504

Required:

If required, round unit cost answers to the nearest cent.

1. Calculate the unit cost and the cost of finished goods inventory under absorption costing.

Unit Cost	$____________
Cost of finished goods inventory	$____________

2. Calculate the unit cost and the cost of finished goods inventory under variable costing.

Unit Cost	$___________
Cost of finished goods inventory	$____________

3. What is the dollar amount that would be used to report the cost of finished goods inventory to external parties? $_____________

Why?