Product A is produced with the following costs: 1)      Paper material   P20 per unit 2)      Plastic                P15 per unit 3)      Rubber              P27000 per 12000 units. 4)      Labor                 P4 per unit 5)      Indirect material costs    P2.5 per unit The company pays P60,000 for rent  per month for factory. It depreciates a P300,000 vehicle used for delivery and a P210,000-machine used for manufacturing, both have a life of 5 years.   a.  How much should be the total overhead costs if in a month, 1000 units were produced? b.  How much should be the direct material costs if in a month, 1,500 units were produced? c. How much is the total conversion cost if 3,000 units are produced?

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Product A is produced with the following costs:

1)      Paper material   P20 per unit

2)      Plastic                P15 per unit

3)      Rubber              P27000 per 12000 units.

4)      Labor                 P4 per unit

5)      Indirect material costs    P2.5 per unit

The company pays P60,000 for rent  per month for factory. It depreciates a P300,000 vehicle used for delivery and a P210,000-machine used for manufacturing, both have a life of 5 years.

 

a.  How much should be the total overhead costs if in a month, 1000 units were produced?

b.  How much should be the direct material costs if in a month, 1,500 units were produced?

c. How much is the total conversion cost if 3,000 units are produced?

d.How much is the total product cost per unit if in a month of production 4,750 units were produced?

e. How many units should be sold in a month to break even?

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