2. A business produces one product which requires the following inputs: Direct Materials 6 kg at $ 4,80 per kg 4 hour at $7 per hour $18.000 per period Direct labour Building cost Leased machine $600 for every 600 units (each machine has a capacity of 600 units) Store Cost $3.000 per period plus $3 per unit What is the total cost of production and the cost per unit at each of the following production levels: а. -1000 units -2000 units b. Explain why the cost per unit is different at each level of production

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
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Chapter5: Process Costing
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Problem 2PB: The following product costs are available for Kellee Company on the production of eyeglass frames:...
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2. A business produces one product which requires the following inputs:
Direct Materials 6 kg at $ 4,80 per kg
4 hour at $7 per hour
$18.000 per period
Direct labour
Building cost
Leased machine $600 for every 600 units (each machine has a capacity of 600 units)
Store Cost
$3.000 per period plus $3
per
unit
What is the total cost of production and the cost per unit at each of the following
production levels:
а.
-1000 units
-2000 units
b. Explain why the cost per unit is different at each level of production
Transcribed Image Text:2. A business produces one product which requires the following inputs: Direct Materials 6 kg at $ 4,80 per kg 4 hour at $7 per hour $18.000 per period Direct labour Building cost Leased machine $600 for every 600 units (each machine has a capacity of 600 units) Store Cost $3.000 per period plus $3 per unit What is the total cost of production and the cost per unit at each of the following production levels: а. -1000 units -2000 units b. Explain why the cost per unit is different at each level of production
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