Reference no: EM132872491

Question - Chuck Wagon Grills, Inc., makes a single product-a handmade specialty barbecue grill that it sells for $215. Data for last year's operations follow:

Units in beginning inventory 0

Units produced 9,900

Units sold 9,400

Units in ending inventory 500

Variable costs per unit: Direct materials $64

Direct labor 35

Variable manufacturing overhead 12

Variable selling and administrative 19

Total variable cost per unit $130

Fixed costs: Fixed manufacturing overhead $287,100

Fixed selling and administrative 505,000

Total fixed costs $792,100

Required -

1. Assume that the company uses absorption costing. Compute the unit product cost for one barbecue grill.

2. Assume that the company uses absorption costing. Prepare income statement for last year.