Andrews Company manufactures a line of office chairs. Each chair takes $14 of direct materials and uses 1.9 direct labor hours at $16 per direct labor hour. The variable overhead rate is $1.20 per direct labor hour and the fixed overhead rate is $1.60 per direct labor hour. Andrews expects to have 675 chairs in ending inventory. There is no beginning inventory of office chairs. Required: Calculate the unit product cost. (Note: Round to the nearest cent.) Calculate the cost of budgeted ending inventory (Note: Round to the nearest dollar.)

Question

Andrews Company manufactures a line of office chairs. Each chair takes $14 of direct materials and uses 1.9 direct labor hours at $16 per direct labor hour. The variable overhead rate is $1.20 per direct labor hour and the fixed overhead rate is $1.60 per direct labor hour. Andrews expects to have 675 chairs in ending inventory. There is no beginning inventory of office chairs.

Required:

  1. Calculate the unit product cost. (Note: Round to the nearest cent.)
  2. Calculate the cost of budgeted ending inventory (Note: Round to the nearest dollar.)

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