hapter 1 Problems 2 Dozier Company produced and sold 1000 un

hapter 1 Problems 2 Dozier Company produced and sold 1000 units during its first month of operations. It reported the following costs and expenses for the month 39.500 49-300 35.400 31,700 Tarisble mansfacturing overhead Pixed manefacturing overhead ring overhead Varlable sellig expense 21 800 Required t With respect to cost classifications for preparing financial statements 2 With respect to cost classifications for assigning costs to cost objects 3 With respect to cost classifications for mandfacturers a. What is the total product cost? b. What is the total period cost? a. What is total direct manufacturing cos b. What is the sotal indirect manufacturing cost? a. What is the total manufacturing cost? b What is the total nonmanufacturing cost? c What is the total conversion cost and prime cost? 4. With respect to cost classifications for predicting cost behavior s. What is the sotal variable manufacturing cost? b what is the total food cost for the company as a whole? What is the variable cost per unit produced and sold? S With respect to cost classifications for decision making 24

Solution

1. a. Total Production Cost = Direct Material Cost + Direct Labour cost + Total Manufacturing Overhead

Hence Total Production Cost = $78,000 + $39,500 + ($18,600+$30,700) = $166,800

1. b. Total Period Cost = Total Administrative expenses + Total Selling Expenses

Total Administtrative expenses = Fixed Administrative expenses+Variable Administrative expenses

Total Selling Expenses = Fixed selling expenses + Variable selling expenses.

Total Period Cost = $35,400 + $31,700 = $67,100

2. a. Total Direct Manufacturing Cost = Direct Materials + Direct Labour

Total Direct Manufacturing cost = $78,000+$39,500 = $117,500

2.b. Total Indirect Manufacturing Cost = Variable Manufacturing Overheads+Fixed Manufacturing Overheads

Total Indirect Manufacturing Cost = $18,600+$30,700 = $49,300

3.a. Total Manufacturing Cost = Direct Materials + Direct Labour + Total Manufacturing Overheads

Hence Total Manufacturing Cost = $78,000 + $39,500 + ($18,600+$30,700) = $166,800

3b. Total Non-Manufacturing Cost = Total Selling Expenses+Total Administrative Expenses

Total Non-Manufacturing Cost = $35,400 + $31,700 = $67,100

3.c. Total Conversion Cost = Direct Labour + Total Manufacturing Overheads

Total Conversion Cost = $39,500 + $49,300 = $88,800

Total Prime Cost = Direct Material + Direct Labour = $78,000+$39,500 = $117,500

4.a. Total Variable Manufacturing Cost = Direct Materials + Direct Labour + Variable Manufacturing Overhead

Total Variable Manufacturing Cost = $78,000 + $39,500 +$18,600 = $136,100

4.b. Total Fixed Cost for the company = Fixed Manufacturing overhead + Fixed Selling Expenses + Fixed Administrative Expenses

Total Fixed Cost for the company = $30,700 + $21,600 + $26,600 = $78,900

4.c. Variable Cost per unit produced = (Direct Material+ Direct Labour+ Variable Manufacturing Overheads+Variable Selling Expenses+Variable Administrative Expenses)/units

Variable Cost per unit produced = ($78,000 + $39,500 +$18,600 + $13,800+$4,900)1,000 = $154,800/1,000 = $154.80 per unit.

5.Incremental cost per unit = total Incremental Cost /Numbere of units produced = (Direct Materials + Direct labour + Variable manufacturing overheads)/number of units produced = ($78,000 + $39,500 +$18,600)/1000 = $136.10

Hence the incremental cost per additional unit produced is $136.10.

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