Kubin Company's relevant range of production is 28,000 to 31,500 units. When it produces and sells 29,750 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 8.80 Direct labor $ 5.80 Variable manufacturing overhead $ 3.30 Fixed manufacturing overhead $ 6.80 Fixed selling expense $ 5.30 Fixed administrative expense $ 4.30 Sales commissions $ 2.80 Variable administrative expense $ 2.30 Exercise 1-7 (Algo) Direct and Indirect Costs [LO1-1] Required: 1. Assume the cost object is units of production: a. What is the total direct manufacturing cost incurred to make 29,750 units? b. What is the total indirect manufacturing cost incurred to make 29,750 units? 2. Assume the cost object is the Manufacturing Department and that its total output is 29,750 units. a. How much total manufacturing cost is directly traceable to the Manufacturing Department? b. How much total manufacturing cost is an indirect cost that cannot be easily traced to the Manufacturing Department? 3. Assume the cost object is the company's various sales representatives. Furthermore, assume that the company spent $127,925 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representatives' compensation. a. When the company sells 29,750 units, what is the total direct selling expense that can be readily traced to individual sales representatives? b. When the company sells 29,750 units, what is the total indirect selling expense that cannot be readily traced to individual sales representatives? 5 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 3. Assume the cost object is the company's various sales representatives. Furthermore, assume that the company spent $127,925 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representatives' compensation. a. When the company sells 29,750 units, what is the total direct selling expense that can be readily traced to individual sales representatives? (Round per unit value to 2 decimal places.) b. When the company sells 29,750 units, what is the total indirect selling expense that cannot be readily traced to individual sales representatives? 3a. Sales commissions per unit 3a. Number of units sold 3a. Total sales commission $ 0 3a. Fixed portion of sales representatives' compensation 3a. Total direct selling expense $ 0 3b. The total indirect selling expense < Required 2 Show less▲

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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Related questions
Question
Kubin Company's relevant range of production is 28,000 to 31,500 units. When it produces and sells 29,750 units, its
average costs per unit are as follows:
Average Cost
per Unit
Direct materials
$ 8.80
Direct labor
$ 5.80
Variable manufacturing overhead
$ 3.30
Fixed manufacturing overhead
$ 6.80
Fixed selling expense
$ 5.30
Fixed administrative expense
$ 4.30
Sales commissions
$ 2.80
Variable administrative expense
$ 2.30
Exercise 1-7 (Algo) Direct and Indirect Costs [LO1-1]
Required:
1. Assume the cost object is units of production:
a. What is the total direct manufacturing cost incurred to make 29,750 units?
b. What is the total indirect manufacturing cost incurred to make 29,750 units?
2. Assume the cost object is the Manufacturing Department and that its total output is 29,750 units.
a. How much total manufacturing cost is directly traceable to the Manufacturing Department?
b. How much total manufacturing cost is an indirect cost that cannot be easily traced to the Manufacturing Department?
3. Assume the cost object is the company's various sales representatives. Furthermore, assume that the company spent $127,925 of
its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the
company's sales representatives' compensation.
a. When the company sells 29,750 units, what is the total direct selling expense that can be readily traced to individual sales
representatives?
b. When the company sells 29,750 units, what is the total indirect selling expense that cannot be readily traced to individual sales
representatives?
Transcribed Image Text:Kubin Company's relevant range of production is 28,000 to 31,500 units. When it produces and sells 29,750 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 8.80 Direct labor $ 5.80 Variable manufacturing overhead $ 3.30 Fixed manufacturing overhead $ 6.80 Fixed selling expense $ 5.30 Fixed administrative expense $ 4.30 Sales commissions $ 2.80 Variable administrative expense $ 2.30 Exercise 1-7 (Algo) Direct and Indirect Costs [LO1-1] Required: 1. Assume the cost object is units of production: a. What is the total direct manufacturing cost incurred to make 29,750 units? b. What is the total indirect manufacturing cost incurred to make 29,750 units? 2. Assume the cost object is the Manufacturing Department and that its total output is 29,750 units. a. How much total manufacturing cost is directly traceable to the Manufacturing Department? b. How much total manufacturing cost is an indirect cost that cannot be easily traced to the Manufacturing Department? 3. Assume the cost object is the company's various sales representatives. Furthermore, assume that the company spent $127,925 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representatives' compensation. a. When the company sells 29,750 units, what is the total direct selling expense that can be readily traced to individual sales representatives? b. When the company sells 29,750 units, what is the total indirect selling expense that cannot be readily traced to individual sales representatives?
5
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Required 3
3. Assume the cost object is the company's various sales representatives. Furthermore, assume that the company spent
$127,925 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the
fixed portion of the company's sales representatives' compensation.
a. When the company sells 29,750 units, what is the total direct selling expense that can be readily traced to individual sales
representatives? (Round per unit value to 2 decimal places.)
b. When the company sells 29,750 units, what is the total indirect selling expense that cannot be readily traced to individual
sales representatives?
3a. Sales commissions per unit
3a. Number of units sold
3a. Total sales commission
$
0
3a. Fixed portion of sales representatives' compensation
3a. Total direct selling expense
$
0
3b. The total indirect selling expense
< Required 2
Show less▲
Transcribed Image Text:5 Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 3. Assume the cost object is the company's various sales representatives. Furthermore, assume that the company spent $127,925 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representatives' compensation. a. When the company sells 29,750 units, what is the total direct selling expense that can be readily traced to individual sales representatives? (Round per unit value to 2 decimal places.) b. When the company sells 29,750 units, what is the total indirect selling expense that cannot be readily traced to individual sales representatives? 3a. Sales commissions per unit 3a. Number of units sold 3a. Total sales commission $ 0 3a. Fixed portion of sales representatives' compensation 3a. Total direct selling expense $ 0 3b. The total indirect selling expense < Required 2 Show less▲
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