31 PRODUCT COST SCHEDULE Prepare a cost schedule for Austin

31. PRODUCT COST SCHEDULE Prepare a cost schedule for Austin Company for Product X and Product Y using the following layout: (Input Area) Product X Product Y Total Units DM Cost/Unit DL Cost/Unit OH allocation rate Total OH (X & Y) (Output Area) Company Name Product Cost Schedule Date Product X Product Y Direct Materials Direct Labor Manufacturing Overhead Total Cost The costs of the direct material for the two products are $2.00 per unit for X and $3.00 pet unit for Y. The direct labor costs are $.25 per unit produced for either product. The total manufacturing overhead for the year is $300,000. This should be allocated to the different products based on the ratio of each product\'s production to total production. Austin Company produced 100,000 units of product X and 50,000 units of product Y.

Solution

Answer

It is mentioned that Manufacturing Overhead will be divided between the Product according to the production of Product.

Product share = (Product production / Total Production) * Total Manufacturing Overhead

Product X= (100,000 Units / 150,000 Units) * $300,000

Product X = $200,000

Product Y= (50,000 Units / 150,000 Units) * $300,000

Product Y = $100,000

Overhead Allocation rate = Total Overhead / Total Production of Product X and Y

= $300,000 / 150,000 Units

Overhead Allocation rate = $2 per Unit

Input Area

Product X

Product Y

Total Units

         100,000

           50,000

DM Cost/Unit

                      2

                      3

DL Cost/Unit

                0.25

                0.25

OH Allocation Rate

2 Per Unit

2 Per Unit

Total OH (X&Y)

         300,000

Output Area

Product X

Product Y

Direct Material

         200,000

         150,000

Direct Labor

           25,000

           12,500

Manufacturing Overhead

         200,000

         100,000

Total cost

         425,000

         262,500

Input Area
	Product X	Product Y
Total Units	100,000	50,000
DM Cost/Unit	2	3
DL Cost/Unit	0.25	0.25
OH Allocation Rate	2 Per Unit	2 Per Unit
Total OH (X&Y)	300,000
Output Area
	Product X	Product Y
Direct Material	200,000	150,000
Direct Labor	25,000	12,500
Manufacturing Overhead	200,000	100,000
Total cost	425,000	262,500