Kubin Company's relevant range of production is 30,000 to 35,000 units. When it produces and sells 32,500 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost per Unit $9.00 $6.00 $3.50 $7.00 $ 5.50 $ 4.50 $ 3.00 $ 2.50 equired: Assume the cost object is units of production: a. What is the total direct manufacturing cost incurred to make 32,500 units? b. What is the total indirect manufacturing cost incurred to make 32,500 units? Assume the cost object is the Manufacturing Department and that its total output is 32,500 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?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Kubin Company's relevant range of production is 30,000 to 35,000 units. When it produces and sells 32,500
units, its average costs per unit are as follows:
Direct materials
Direct labor
Variable manufacturing overhead
Fixed manufacturing overhead
Fixed selling expense
Fixed administrative expense
Sales commissions
Variable administrative expense
Average Cost
per Unit
$9.00
$6.00
$ 3.50
$7.00
$5.50
$4.50
$ 3.00
$2.50
Required:
1. Assume the cost object is units of production:
a. What is the total direct manufacturing cost incurred to make 32,500 units?
b. What is the total indirect manufacturing cost incurred to make 32,500 units?
2. Assume the cost object is the Manufacturing Department and that its total output is 32,500 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
Transcribed Image Text:Kubin Company's relevant range of production is 30,000 to 35,000 units. When it produces and sells 32,500 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost per Unit $9.00 $6.00 $ 3.50 $7.00 $5.50 $4.50 $ 3.00 $2.50 Required: 1. Assume the cost object is units of production: a. What is the total direct manufacturing cost incurred to make 32,500 units? b. What is the total indirect manufacturing cost incurred to make 32,500 units? 2. Assume the cost object is the Manufacturing Department and that its total output is 32,500 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
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