Wool Creations Inc., manufactures wool sweaters. Costs incurred in making 9000 sweaters in October included $22,500 of fixed manufacturing overhead. The total absorption cost per sweater was $11.60.

Required:

a. Calculate the variable cost per sweater.

b. The ending inventory of sweaters was 1600 units lower at the end of the month than at the beginning of the month. By how much and in w hat direction (higher or lower) would cost of goods sold for the month of October be different under variable costing than under absorption costing?

c. Express the sweater cost in a cost formula.