Roy Corporation produces a single product. During July, Roy produced 12,800 units. Costs incurred during the month were as follows:

Direct materials	$ 25,600
Direct labor	$ 38,400
Variable manufacturing overhead	$ 12,800
Variable selling and administrative	$ 5,120
Fixed manufacturing overhead	$ 17,920
Fixed selling and administrative	$ 3,840
Total cost	$ 103,680

Under absorption costing, any unsold units would be carried in the inventory account at a unit product cost of:

→	$7.40
	$6.80
	$6.50

Direct materials	$ 25,600
Direct labor	38,400
Variable manufacturing overhead	12,800
Fixed manufacturing overhead cost	17,920
Absorption costing product cost	$94,720

Absorption costing unit product cost = $94,720 ÷ 12,800 units = $7.40 per unit