Absorption Costing Query – Product Z (BP Revision Kit Ch9 Q9.5 AC&MC P41& P163)

Hello John,

I’m stuck on the following question. and really need your help please

Cost and Selling Prices for Product Z are:

DM $6
DL $7.50
VPOH $2.50
FPOH OAR $5
Total $21
Profit $9
Selling Price $30

Budgeted Production for the month was 5000 units. The Co managed to produce 5800 units. Selling 5200 units. Incurred Fixed OH Costs of $27,400.

What was AC profit for the month ?

The answer provided, which confuses me is:

Sales (5200 @ $30) $156,000
Materials (5200 @ $6) $31,200
Labour (5200 @ $7.50) $39,000
Variable OH (5200 @ $2.50) $13,000

Total Variable Costs ($83,200)
Fixed OH ($5 @ 5200) $26,000
Over-absorbed OH $1600
AC Profit $48,400

I understand the Sales Revenue:
Sales Revenue (Units sold 5200 x $30) $156,000

However, the following confuses me:

Less Cost of sales
Opening Inventory $0
Add Production Costs:
($6+7.50+2+5=) $21 x 5800 = $121800

I’ve gone wrong somewhere, but I always thought it was Total production costs. ( In this case as its AC, its $21, as it includes OAR) x units produced.
Co managed to produce 5800 units.

So, $21 x 5800 = $121800

But the answer took the units sold 5800 x $21

Can you please help me. I’m now very confused. Thank you.