Can anyone please help with this question? Its not for a test but homework help for my online class. Its tough not being able to talk to instructor. I am not wanting the answers just trying to figure out how to solve this problem. Mainly the full costing and variable costing formulas is where its tricky for me. Thanks for reading

Abigail Corporation produces widgets. In 2008, its first year of operations, the company produced 100,000 widgets and sold 90,000 widgets. The selling price is $70 per widget.

The production costs are
Direct Materials $10 per widget
Direct Labor $5 per widget
Variable Manufacturing Overhead $12 per widget
Fixed Manufacturing Overhead $600,000 in total

The company also had fixed selling costs of $100,000 and fixed administration costs of $150,000

Answer the following questions:

1. How many widgets are in the inventory at the end of the year?
2. Under the variable costing method, are fixed overhead costs a product or period cost?
3. Under the full costing method, are fixed overhead costs a product or period cost?
4. Under the full costing method, are fixed selling costs a product or period cost?
5. What is the product cost of one widget using the full costing method?
6. What is the product cost of one widget using the variable costing method?
7. What is the cost of goods sold using the full costing method?
8. What is the variable cost of goods sold?
9. What is the dollar value of the widget inventory at the end of the year using full costing?
10. What is the dollar value of the widget inventory at the end of the year using variable costing?

I am not an accountant, but will try and help a little bit. Someone else may have to expain it to you further.

To find inventory amounts you would subtract the amount sold from the amount made since it is the first year of the business. 100,000 made - 90,000 sold is equal to 10,000 left in inventory. If it would be the 2nd year of business you would do the same but you would have to add the 10,000 existing inventory.

To figure selling costs:

A. Total Variable Cost = total cost of producing x units of goods - total cost of producing 0 goods. That is easy enough to calculate. Use your table or equations to get the amounts you need.
B. Average Variable Cost = total variable cost / number of units. This one is a little bit trickier because you must calculate total variable cost first.
C. Fixed cost is the cost incurred when producing 0 units. This cost usually remains constant and is independent of production. Examples include rent, utilities, building maintenance, etc. Using the table this cost is found next to 0 quantity. Using an equation, simply substitute 0 for your variable (x, y, Q, etc.)

You need to figure out what it costs to produce 1 widget and than take that cost either veriable or full cost x the number left in inventory which is 10,000. That would answer 9 and 10.

Full costing method is a costing system which treats all costs of production as product costs whether they are variable or fixed. The cost of a unit of product under full costing includes direct materials, direct labor, both variable and fixed overhead. These are considered product costs.

Variable costing is a costing system under which those costs of production that vary with output are treated as product costs this would usually include direct materials, direct labor and variable portion of overhead. Fixed manufacturing cost is not treated as product cost under variable costing. Fixed manufacturing cost is treated as a period cost this would be like selling and administration expenses. It would be charged off in it's entirety against revenue each period.

Shirley