Question

*will someone please explain/show the steps in this process for me? Thank you so much!

Amy company produces and sells a toy for $205 per unit. In the first year of operations, 100,000 units were produced and 75,000 were sold. other information for the year includes:

direct materials $31 per unit

direct manufacturing labor $3 per unit

variable manufacturing overhead costs $4 per unit

sales selling expenses $4 per unit

total fixed manufacturing costs $1,250,000

total fixed administrative expenses $950,000

a. compute the contribution margin per unit

Answer $163

b. then compute the inventoriable cost per unit under absorption costing

Answer $50.50

c. and finally, compute the inventoriable cost per unit under variable costing

Answer $38.00

Answer 1

`
	Contribution Margin per unit
a)	Sales Price Per Unit		$                 205.00
	Less: Variable Cost
	Direct Material	$                    31.00
	Direct Manufacturing Labor	$                      3.00
	Variable manufacturing overhead cost	$                      4.00
	Sales selling expense per unit	$                      4.00
	Total Variable cost		$                   42.00
	contribution Margin per unit		$                 163.00
	Inventories cost per unit under Absorption Costing
b)
	Production	100000
	Sales	75000
*	Variable Manufacturing Cost=(A)	$                    38.00
	Fixed Manufacturing Cost=Fixed Production Cost/Production=(B)($1250000/100000)	$                    12.50
	Unit Product Cost=Variable Manufacturing cost+Fixed Manufacturing cost=(A)+(B)	$                    50.50
	Variable Manufacturing cost=Direct Material cost,Direct Labor cost and Variable manufacturing overhead=($31+$3+$4)
c )	Inventories cost per unit under variable costing
	Direct Material	$                    31.00
	Direct Manufacturing labor cost	$                      3.00
	Variable Manufacturing cost	$                      4.00
	Cost of goods sold	$                    38.00