Inventory Valuation under Absorption and Variable Costing
Overton Company produced 80,000 units last year. The company sold 79,000 units and there was no beginning inventory. The company chose practical activity-at 80,000 units-to compute its predetermined overhead rate. Manufacturing costs are as follows:
Required:
- 1.Calculate the cost of one unit of product under absorption costing.
- 2.Calculate the cost of one unit of product under variable costing.
- 3.Calculate the cost of ending inventory under absorption costing.
- 4.Calculate the cost of ending inventory under variable costing.