This is all the information I have for this question Assignm

This is all the information I have for this question.

Assignments: SP18: INT X) a Connect d Secure ! https://newconnect.mheducation.com/flow/connect.html \\ esearch Tutors! Chegg.c × \\ () How do l take ×A × screens : Chapter 1 Homework Saved Help Save & Exit Submit Check my work 1ng Miller Company\'s total sales are $126,000. The company\'s direct labor cost is $15120, which represents 30% of its total conversion cost and 40% of its total prime cost. Its total selling and administrative expense is $18,900 and its only variable selling and administrative expense is a sales commission of 5% of sales. The company maintains no beginning or ending inventories and its manufacturing overhead costs are entirely fixed costs 3.5 points Required 1. What is the total manufacturing overhead cost? 2. What is the total direct materials cost? 3. What is the total manufacturing cost? 4. What is the total variable selling and administrative cost? 5. What is the total variable cost? 6. What is the total fixed cost? 7. What is the total contribution margin? eBook Print 1. Total manufacturing overhead cost 2. Total direct materials cost 3. Total manufacturing cost 4. Total variable selling and administrative cost 5. Total variable cost 6. Total fxed cost 7. Total contribution margin Graw Hill O Type here to search 2-53 PM 1/16/2018

Solution

Analysis of the question:

Total sales

126000

Direct Material

22680

=Prime cost- Direct labor cost

Direct Labor cost

15120

given

Prime cost

37800

=15120/0.40

Manufacturing overhead

35280

=Conversion cost- Direct labor cost

Conversion cost

50400

=15120/0.30

Selling and admin exp.

18900

given

Sell commission

6300

5% of sales

SOLUTION:

1. Manufacturing Overhead cost:

Manufacturing overhead cost is not given. But the Direct labor is given as $15120 and Conversion cost can be derived from direct labor. Conversion cost is 1/30% of Direct labor = 50,400 as calculated above.

Conversion cost = Direct Labor + Manufacturing Overhead

Manufacturing Overhead = Conversion cost - Direct Labor = 50000-15000 =$35280

2. Direct Material Cost

Prime cost is derived as 1/40% of Labor cost, i.e. 37800.

Direct Labor cost is given as 15120

Prime cost = Direct Material + Direct Labor

Or Direct Material = Prime cost - Direct Labor = 37800 -15120 = $22680

3. Total manufacturing cost

Direct material + Direct Labor + Manufacturing overheads = Total Manufacturing cost

22680 + 15120 + 35280 = $73080

4. Variable selling and admin cost

The only variable selling and administrative expense is a sales commission of 5% of sales.

Sales is given as $126,000

So Variable selling and admin cost = 126,000*5% = $6300

5. Variable cost = (DM +Direct labor +Variable admin OH) = 22680+15120+6300= $43,500

6.

Fixed Cost The manufacturing overheads are entirely fixed = 35280 as calculated above Total Admin and selling expenses is $18,900 out of which sales commission of $6,300 is variable So the

Fixed admin cost = 18900- 6300 = $12,600 Hence, Total Fixed cost = $35280 +12600 = $47,880

7.

Contribution Margin: = Contribution/ Sales X100

Contribution = Sales - Variable cost Sales

Variable cost = (DM +DL +Variable admin OH)= 22680+15120+6300= $43,500

Contribution= 126,000 -44100 = 81900

Contribution margin = 81900/126000 X100= 65%

PLEASE RATE or if you have any query please comment before providing negative feedback

Total sales		126000
Direct Material	22680	=Prime cost- Direct labor cost
Direct Labor cost	15120	given
Prime cost		37800	=15120/0.40
Manufacturing overhead	35280	=Conversion cost- Direct labor cost
Conversion cost	50400	=15120/0.30
Selling and admin exp.	18900	given
Sell commission	6300	5% of sales