A company uses an absorption costing system; however, the company is considering using marginal

costing. Data regarding planned and actual operations for the calendar year is:
Planned Activity Actual Activity
Sales (in units) 140,000 125,000
Production (in units) 140,000 130,000
The planned per unit cost figures shown in the next schedule were based on the estimated production
and sale of 140,000 units for the year. It uses a predetermined manufacturing overhead rate for
applying manufacturing overhead to its product; therefore, a combined manufacturing overhead rate of
$9.00 per unit was employed for absorption costing purposes.

There are no work-in-process inventories at either the beginning or the end of the year. The planned
and actual unit selling price for the current year was $70.00 per unit.