Product cost per meal under absorption

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Reference no: EM13147705

Seattle Enterprises produces packaged fresh meals which it sells for $10 each. During the current month, Seattle produced 2,800 meals, but only sold 2,700 meals. The variable cost per meal was $6 and the sales commissions per meal were $1. Total fixed manufacturing costs were $1,400 and total fixed marketing and administrative costs were $1,200. What is the product cost per meal under absorption and under variable costing?

A. Absorption $6.00 and variable $7.00

B. Absorption $6.50 and variable $6.00

C. Absorption $7.50 and variable $7.00

D. None of the above

Reference no: EM13147705

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