Question 1Flounder Company specializes in manufacturing a unique model of bicycle helmet. The model is well accepted by consumers, and the company has enough orders to keep the factory production at 10,000 helmets per month (80% of its full capacity). Flounder’s monthly manufacturing cost and other expense data are as follows.Rent on factory equipment $12,000Insurance on factory building 1,780Raw materials used (plastics, polystyrene, etc.) 80,800Utility costs for factory 920Supplies for general office 320Wages for assembly line workers 59,700Depreciation on office equipment 830Miscellaneous materials (glue, thread, etc.) 1,470Factory manager’s salary 6,200Property taxes on factory building 490Advertising for helmets 14,900Sales commissions 10,900Depreciation on factory building 1,640Prepare an answer sheet with the following column headings.Enter each cost item on your answer sheet, placing the dollar amount under the appropriate headings. Total the dollar amounts in each of the columns. Compute the cost to produce one helmet.Production cost per helmet$4

Solution:- Product Costs cost item Direct Materials Direct Labor Manufacturing…

Answered: Compute the cost to produce one helmet.…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question 1

Flounder Company specializes in manufacturing a unique model of bicycle helmet. The model is well accepted by consumers, and the company has enough orders to keep the factory production at 10,000 helmets per month (80% of its full capacity). Flounder’s monthly manufacturing cost and other expense data are as follows.

Rent on factory equipment		$12,000
Insurance on factory building		1,780
Raw materials used (plastics, polystyrene, etc.)		80,800
Utility costs for factory		920
Supplies for general office		320
Wages for assembly line workers		59,700
Depreciation on office equipment		830
Miscellaneous materials (glue, thread, etc.)		1,470
Factory manager’s salary		6,200
Property taxes on factory building		490
Advertising for helmets		14,900
Sales commissions		10,900
Depreciation on factory building		1,640

Prepare an answer sheet with the following column headings.

Enter each cost item on your answer sheet, placing the dollar amount under the appropriate headings. Total the dollar amounts in each of the columns.

Compute the cost to produce one helmet.
Production cost per helmet
$4

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