Yellowstone Fabricators uses a process cost system and applies actual factory overhead to work in process at the end of the month. The following data came from the records for March:
Direct materials................................................... $200,000
Direct labor......................................................... $100,000
Variable factory overhead.................................... $ 80,000
Fixed factory overhead........................................ $ 60,000
Selling and administrative expenses ................... $ 40,000
Units produced.......................................................25,000
Units sold.............................................................. 20,000
Selling price per unit................................................. $ 25
There were no beginning inventories and no ending work in process inventory.
From the information presented, compute the following:
a. Unit cost of production under absorption costing and variable costing.
b. Cost of the ending inventory under absorption costing and variable costing.