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Case: Melter Corporation, which has only one product and provided the following data concerning its most recent month of operations:
The company produces the same number of units every month, although the sales in units vary from month to month. The company's variable costs per unit and total fixed costs have been constant from month to month.
Selling price
$122
Units in beginning inventory
290
Units produced
6,600
Units sold
6,590
Variable costs per unit:
Direct materials
$42
Direct labour
$26
Variable manufacturing overhead
$21
Variable selling and administrative expense
$2
Fixed costs:
Fixed manufacturing overhead
$151,800
Fixed selling and administrative expense
$46,130
Required:
A. Unit product Cost using Variable Costing
B. Unit product cost using Absorption Costing
C. Make a contribution format income statement for the month using variable costing.
D. Make an income statement for the month using absorption costing.
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