Answer
Iron City produced 200,000 six-packs in 2014.
Work Step by Step
To find out the number of six-packs produced in 2014, we can use the unit cost of ending inventory and the total fixed manufacturing costs:
We calculated the unit cost of ending inventory under variable costing as \$7.15 and under absorption costing as \$8.30. The difference between these unit costs, which is \$1.15 (\$8.30 - \$7.15), represents the unit fixed manufacturing cost of goods produced during the period.
Now, we can calculate the units produced:
Units Produced = Total Fixed Manufacturing Costs $\div$ Unit Fixed Manufacturing Cost of Production
Units Produced = \$230,000 (total fixed manufacturing costs) $\div$ \$1.15 (unit fixed manufacturing cost)
Units Produced = 200,000 six-packs
