Question - On June 30, the end of the first year of operations, Reinemund Equipment Company manufactured 2,200 units and sold 1,900 units. The following income statement was prepared, based on the variable costing concept:
Reinemund Equipment Company Variable Costing Income Statement for the Year Ended Jen 30, 2011:
Sales: 45,600,000
Variable cost of goods sold:
Variable cost of goods manufactured: 25,344,000
Less inventory, July 31 3,456,000
Variable cost of goods sold 21,888,000
Manufacturing Margin 23,712,000
Variable selling/administrative expenses 5,472,000
Contribution Margin 18,240,000
Fixed Costs:
Fixed manufactoring cost: 11,616,000
Fixed selling/admin expenses 3,648,000 15,264,000
Income from operations 2,976,000
Determine the unit cost of goods manufactured, based on (a) the variable costing concept and (b) the absorption costing concept.