Answer:
Instructions are lsited below.
Explanation:
Giving the following information:
Fixed manufacturing costs are $44 per unit
Variable manufacturing costs are $100 per unit.
Production was 67,200 units, while sales were 50,400 units.
First, we need to calculate the total cost of production under each method.
Variable:
Unitary cost= variable manufacturing cost
Unitary cost= 100
Total cost= cost of goods sold + fixed manufacturing costs
Total cost= 5,040,000 + (100*67,200)= $11,760,000
Absorption:
Unitary cost= variable manufacturing cost + fixed manufacturing cost
Unitary cost= 100 + 44= 144
Total cost= cost of goods sold
Cost of goods sold= 144*50,400= $7,257,600
