Calculate the full production cost perunit

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Reference no: EM13955785

Saturn, a chocolate manufacturer, produces three products:Information relating to each of the products is as follows:The Sky Bar, a bar of solid milk chocolate.

The Moon Egg, a fondant filled milk chocolate egg.
The Sun Bar, a biscuit and nougat based chocolate bar.

Information relating to each products is a s follows:

Direct labour cost/unit ($): SkyBar(0.07); MoonEgg (0.14); SunBar(0.12)
Direct material cost per unit($): Sky Bar(0.17); Moon Egg(0.19); Sun Bar(0.16)
Actual production/ sales(units): Sky Bar(500,000); Moon Egg(150,000); Sun Bar(250,000)
Direct labour hours per unit: Sky Bar(0.001); Moon Egg(0.01); Sun Bar(0.005)
Direct machine hours per unit: Sky Bar(0.01); Moon Egg(0.04); Sun Bar(0.02)
Selling price per unit($): Sky Bar(0.50); Moon Egg(0.45); Sun Bar(0.43)
Annual production overhead = $80,000

Required:

Using traditional absorption costing, calculate the full production cost perunit and the profit per unit for each product. Comment on theimplications of the figures calculated.

Reference no: EM13955785

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