Compute the unit product cost for one gamelan

Reference no: EM13123662

Ida Sidha Karya Company is a family-owned company located in the village of Gianyar on the island of Bali in Indonesia. The company produces a handcrafted Balinese musical instrument called a gamelan that is similar to a xylophone. The sounding bars are cast from brass and hand-filed to attain just the right sound. The bars are then mounted on an intricately hand-carved wooden base. The gamelans are sold for 850 (thousand) rupiahs. (The currency in Indonesia is the rupiah, which is denoted by Rp.) Selected data for the company's operations last year follow (all currency values are in thousands of rupiahs):

Units in beginning inventory 0
Units produced 250
Units sold 225
Units in ending inventory 25

Variable costs per unit:
Direct materials Rp100
Direct labor Rp320
Variable manufacturing overhead. Rp40
Variable selling and administrative. Rp20

Fixed costs:
Fixed manufacturing overhead Rp60,000
Fixed selling and administrative Rp20,000

1. Assume that the company uses absorption costing. Compute the unit product cost for 1 gamelan.
2. Assume that the company uses variable costing. Compute the unit product cost for 1 gamelan.

Reference no: EM13123662

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