Variable / Absorption Costing

After our first year at Peloton, COVID hits, and all of our prior cost assumptions are tossed to the side. We recalculate all of the costs and have the following:

Direct Materials $750 / bike

Direct Labor $500 / bike

Variable Overhead $150 / bike

Fixed Overhead $600,000 for the year

Variable S,G &A $20,000

Fixed S,G &A $25,000

Units Produced 5,000 bikes

Units Sold 4,000 bikes

11: . IF we use absorption costing what is the product cost / unit? How much cost would be added to ending inventory for the period?

12: IF we use variable costing what is the product cost / unit? How much cost would be added to ending inventory for the period?

13: . In Variable Costing, we introduced a new term. It was calculated as Sales Variable Cost of Goods Sold (or we also called it our Variable Manufacturing Costs). What was that term?