The total manufacturing costs for the year were $660000; the goods available for sale totaled $740000 and the cost of goods sold totaled $660000.Required:
1. Prepare a schedule of cost of goods manufactured and the cost of goods sold section of the companys income statement for the year.
2. Assume that the dollar amounts given above are for the equivalent of 40000units produced during the year. Compute the average cost per unit for direct materials used and the average cost per unit for rent on the factory building.
3. Assume that in the following year the company expects to produce 50000 units. What average cost per unit and total cost would you expect to be incurred for direct material for rent on the factory building? (Assume that direct materials are a variable cost and that rent is a fixed cost).
4. As the manager in charge of production costs explain to the president the reason for any difference in average cost per unit between (2) and (3) above.
