Homework SourseNatural Taste is a new startup company that is specialized i
Natural Taste is a new startup company that is specialized in water purifying industry has the following costs:
Safety instrument= $3,000
Materials waste = $1,000
Electricity cost in offices = $500
Periodic replacement parts after 10,000 bottles produced = $750 Cost of equipment and installation = $50,000
Minerals used at purification = $20,000
Clerical Salaries = $4,500
Material used in Bottles = $1,500
Administrative expenses = $2,900
Labor used in production = $11,500
Fixed manufacturing costs used in production = $10,500
Categorize the costs given into fixed or variable costs, recurring or nonrecurring costs, and direct or indirect costs?
What is the total fixed cost, the total variable cost and total direct cost in dollars?
Solution
Safety instrument= $3,000
Electricity cost in offices = $500
Cost of equipment and installation = $50,000
Clerical Salaries = $4,500
Administrative expenses = $2,900
Fixed manufacturing costs used in production = $10,500
Materials waste = $1,000
Periodic replacement parts after 10,000 bottles produced = $750
Minerals used at purification = $20,000
Material used in Bottles = $1,500
Labor used in production = $11,500
Total Fixed Costs =
$ 71,400
Total Variable Costs =
$ 34,750
Materials waste = $1,000
Electricity cost in offices = $500
Periodic replacement parts after 10,000 bottles produced = $750
Minerals used at purification = $20,000
Clerical Salaries = $4,500
Material used in Bottles = $1,500
Administrative expenses = $2,900
Labor used in production = $11,500
Safety instrument= $3,000
Cost of equipment and installation = $50,000
Fixed manufacturing costs used in production = $10,500
Materials waste = $1,000
Periodic replacement parts after 10,000 bottles produced = $750
Cost of equipment and installation =$ 50,000
Minerals used at purification = $20,000
Material used in Bottles = $1,50
Labor used in production = $11,500
Safety instrument= $3,000
Electricity cost in offices = $500
ClericalSalaries = $4,500
Administrative expenses = $2,900
Fixed manufacturing costs used in production = $10,500
Total Direct Costs
= $84,750
Total Indirect Costs
= $21,400
| Fixed Cost | Variable Cost |
| Safety instrument= $3,000 Cost of equipment and installation = $50,000 Clerical Salaries = $4,500 | Materials waste = $1,000 Minerals used at purification = $20,000 |
| Total Fixed Costs = $ 71,400 | Total Variable Costs = $ 34,750 |
| Recurring Costs | Non - recurring Costs |
| Materials waste = $1,000 Minerals used at purification = $20,000 Clerical Salaries = $4,500 | Safety instrument= $3,000 Fixed manufacturing costs used in production = $10,500 |
| Direct Costs | Indirect Costs |
| Materials waste = $1,000 Cost of equipment and installation =$ 50,000 Minerals used at purification = $20,000 | Safety instrument= $3,000 ClericalSalaries = $4,500 Administrative expenses = $2,900 |
| Total Direct Costs = $84,750 | Total Indirect Costs = $21,400 |
