Answer:
The correct answer is A.
Explanation:
Giving the following information:
Units produced= 600
Direct materials $30 per unit
Direct labor $13 per unit
Variable manufacturing overhead $6 per unit
Fixed manufacturing overhead $17,800 per year
Ending inventory= 600 - 400= 200 units
Under absorption costing, the fixed overhead costs get allocated to the product cost. First, we need to calculate the unitary fixed overhead cost:
Unitary fixed overhead= 17,800/600= $29.67
Now, we can determine the total unitary cost:
Unitary cost= direct material + direct labor + total overhead
Unitary cost= 30 + 13 + (6 + 29.67)= $78.67
Ending inventory= 200*78.67= $15,736
