Alpha Corp. manufactures video games that it sells for $36 each. The following data is available for the months of October and November.
|
|
October
|
November
|
|
Sales
|
1,600 units
|
3,000 units
|
|
Production
|
2,800 units
|
2,800 units
|
|
Variables manufacturing cost per game
|
$13
|
$13
|
|
Sales commission per game
|
$6
|
$6
|
|
Total fixed manufacturing overhead
|
$8,400
|
$8,400
|
|
Total fixed marketing and administrative costs
|
$7,500
|
$7,500
|
*variables manufacturing cost program includes $7 for direct material.
a Determine the unit product cost for each month using the absorption, variable and throughput costing approaches.
b Prepare an income statement for November using the variable costing approach