Dake Corporations relevant range of activity is 4000 units t

Dake Corporation\'s relevant range of activity is 4,000 units to 8,000 units. When it produces and sells 6,000 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost per Unit $7.15 $3.40 $1.95 $3.20 $0.85 $0.55 $0.65 $0.55 For financial reporting purposes, the total amount of product costs incurred to make 6,000 units is closest to:

Solution

Answer a. $94,200 Direct Materials - 6,000 Units X $7.15    42,900.00 Direct Labor - 6,000 Units X $3.40    20,400.00 Variable MOH - 6,000 Units X $1.95    11,700.00 Fixed MOH - 6,000 Units X $3.20    19,200.00 Total Product Costs    94,200.00