Cost Definitions Wyandotte Company provided the following in

Cost Definitions Wyandotte Company provided the following information for the last calendar year: Beginning inventory Direct materials $25,900 Work in process 44,700 Ending inventory: Direct materials $18,000 Work in process 22,700 During the year, direct materials purchases amounted to $256,900, direct labor cost was $176,000, and overhead cost was $308,400. There were 40,000 units produced. e here to search

Solution

Answer 1.

Direct Materials used = Beginning Direct Materials + Direct Materials purchased - Ending Direct Materials
Direct Materials used = $25,900 + $256,900 - $18,000
Direct Materials used = $264,800

Answer 2.

Manufacturing Cost = Direct Materials used + Direct Labor Cost + Overhead Cost
Manufacturing Cost = $264,800 + $176,000 + $308,400
Manufacturing Cost = $749,200

Cost of Goods Manufactured = Beginning Work in Process + Manufacturing Cost - Ending Work in Process
Cost of Goods Manufactured = $44,700 + $749,200 - $22,700
Cost of Goods Manufactured = $771,200

Unit Manufacturing Cost = Manufacturing Cost / Number of units produced
Unit Manufacturing Cost = $749,200 / 40,000
Unit Manufacturing Cost = $19.28

Answer 3.

Unit Manufacturing Cost = Direct Materials per unit + Direct Labor per unit + Overhead Cost per unit
$19.28 = $6.62 + Direct Labor per unit + $7.71
Direct Labor per unit = $4.40

Prime Cost per unit = Direct Materials per unit + Direct Labor per unit
Prime Cost per unit = $6.62 + $4.40
Prime Cost per unit = $11.02

Conversion Cost per unit = Direct Labor per unit + Overhead Cost per unit
Conversion Cost per unit = $4.40 + $7.71
Conversion Cost per unit = $12.11