Kubin Company's relevant range of production is 11,000 to 14,000 units. When it produces and sells 12,500 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 7.20 Direct labor 4.20 Variable manufacturing overhead 1.70 Fixed manufacturing overhead 5.20 Fixed selling expense 3.70 Fixed administrative expense $ 2.70 Sales commissions $ 1.20 Variable administrative expense $ 0.70 Required: 1. what is the total direct manufacturing cost incurred to make 12,500 units? 2 what is the total indirect manufacturing cost incurred to make 12,500 units? 3.Assume the cost object is the Manufacturing dept and its total output is $12,500 units. How much manufacturing cost is direct traceable to the manufacturing dept? and How much manufacturing cost is indirect traceable to the manufacturing dept? 4. Assume the cost object is the company's various sales. Assume the company spent $33,750 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representative's compensation. When the company sells 12,500 units, what is the total direct selling expense that can be traced to individuals sales? When the company sells 12,500 units, what is the total indirect selling expense that can be traced to individuals' sales? %24 %24 %24 %24 %24 %24 %24 %24
Kubin Company's relevant range of production is 11,000 to 14,000 units. When it produces and sells 12,500 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 7.20 Direct labor 4.20 Variable manufacturing overhead 1.70 Fixed manufacturing overhead 5.20 Fixed selling expense 3.70 Fixed administrative expense $ 2.70 Sales commissions $ 1.20 Variable administrative expense $ 0.70 Required: 1. what is the total direct manufacturing cost incurred to make 12,500 units? 2 what is the total indirect manufacturing cost incurred to make 12,500 units? 3.Assume the cost object is the Manufacturing dept and its total output is $12,500 units. How much manufacturing cost is direct traceable to the manufacturing dept? and How much manufacturing cost is indirect traceable to the manufacturing dept? 4. Assume the cost object is the company's various sales. Assume the company spent $33,750 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representative's compensation. When the company sells 12,500 units, what is the total direct selling expense that can be traced to individuals sales? When the company sells 12,500 units, what is the total indirect selling expense that can be traced to individuals' sales? %24 %24 %24 %24 %24 %24 %24 %24
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter2: Basic Cost Management Concepts
Section: Chapter Questions
Problem 21E: Ellerson Company provided the following information for the last calendar year: During the year,...
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Concept explainers
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
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Question
Transcribed Image Text:Kubin Company's relevant range of production is 11,000 to 14,000 units. When it produces and sells
12,500 units, its average costs per unit are as follows:
Average Cost per Unit
Direct materials
$
7.20
Direct labor
4.20
Variable manufacturing overhead
1.70
Fixed manufacturing overhead
5.20
Fixed selling expense
3.70
Fixed administrative expense
$
2.70
Sales commissions
$
1.20
Variable administrative expense
$
0.70
Required:
1. what is the total direct manufacturing cost incurred to make 12,500 units?
2 what is the total indirect manufacturing cost incurred to make 12,500 units?
3.Assume the cost object is the Manufacturing dept and its total output is $12,500 units. How much
manufacturing cost is direct traceable to the manufacturing dept? and How much manufacturing cost
is indirect traceable to the manufacturing dept?
4. Assume the cost object is the company's various sales. Assume the company spent $33,750 of its
total fixed selling expense on advertising and the remainder of the total fixed selling expense
comprised the fixed portion of the company's sales representative's compensation. When the
company sells 12,500 units, what is the total direct selling expense that can be traced to individuals
sales? When the company sells 12,500 units, what is the total indirect selling expense that can be
traced to individuals' sales?
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