Lone Star has computed the following unit costs for the year just ended:
| $ | |
| Direct material used | 10 |
| Direct labor | 18 |
| Variable manufacturing overhead | 30 |
| Fixed manufacturing overhead | 27 |
| Variable selling and administrative cost | 7 |
| Fixed selling and administrative cost | 18 |
Under absorption costing, each unit of the company’s inventory would be carried at:
a. $58.
b. $65.
c. $37.
d. $85.
e. None of these.
