Reference no: EM133039911

Question - Bonita Corp. is a manufacturer of specialty in-line skates. The operating results for 2022 are as follows:

Units produced 19,200 pairs

Units sold 17,000 pairs

Selling price $210.00 per pair

Production information:

Direct materials $998,400

Direct labour 700,800

Variable manufacturing overhead 412,800

Fixed manufacturing overhead 796,800

Variable marketing costs 187,000

Fixed marketing costs 203,100

There was no beginning finished goods inventory.

(a) Assume the company uses normal-absorption costing and uses the budgeted volume of 24,900 pairs to allocate the fixed overhead rate rather than the actual production volume of 19,200 pairs. The company expenses production volume variance to cost of goods sold in the accounting period in which it occurs. Do the following:

1. Calculate the manufacturing cost per unit.

2. Prepare a normal-absorption-costing income statement for 2022.