QUESTION 9 Lambeth Corporation has provided the following in

QUESTION 9 Lambeth Corporation has provided the following information: Cost per Cost per Unit Period $ 4.90 $2.95 $1.25 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Sales commissions Variable administrative expense Fixed selling and administrative expense 8,00 $1.00 $0.40 4,00 If 3,000 units are produced, the total amount of indirect manufacturing cost incurred is closest to: $8,000 $11,750 O$9,750 $3,750

Solution

Ans.) Indirect manufacturing costs are the manufacturer\'s product costs other than direct costs i.e. Direct material,direct labor and other direct expenses.Indirect manufacturing cost includes manufacturing overheads, factory overheads etc. Hence, the total amount of indirect manufacturing cost incurred for producing 3,000 units is $8,000.