Swifty 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). Swifty’s monthly manufacturing cost and other expense data are as follows. Rent on factory equipment $11,100 Insurance on factory building 1,800 Raw materials (plastics, polystyrene, etc.) 80,600 Utility costs for factory 900 Supplies for general office 400 Wages for assembly line workers 67,900 Depreciation on office equipment 900 Miscellaneous materials (glue, thread, etc.) 1,500 Factory manager’s salary 6,600 Property taxes on factory building 500 Advertising for helmets 14,100 Sales commissions 10,400 Depreciation on factory building 1,600 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. Product Costs Cost Item Direct Materials Direct Labor Manufacturing Overhead Period Costs Rent on factory equipment $ $ $ $ Insurance on factory building Raw materials Utility costs for factory Supplies for general office Wages for assembly line workers Depreciation on office equipment Miscellaneous materials Factory manager’s salary Property taxes on factory building Advertising for helmets Sales commissions Depreciation on factory building $ $ $ $

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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Swifty 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). Swifty’s monthly manufacturing cost and other expense data are as follows.

Rent on factory equipment		$11,100
Insurance on factory building		1,800
Raw materials (plastics, polystyrene, etc.)		80,600
Utility costs for factory		900
Supplies for general office		400
Wages for assembly line workers		67,900
Depreciation on office equipment		900
Miscellaneous materials (glue, thread, etc.)		1,500
Factory manager’s salary		6,600
Property taxes on factory building		500
Advertising for helmets		14,100
Sales commissions		10,400
Depreciation on factory building		1,600

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.

	Product Costs
Cost Item	Direct Materials	Direct Labor	Manufacturing Overhead	Period Costs
Rent on factory equipment	$	$	$	$
Insurance on factory building
Raw materials
Utility costs for factory
Supplies for general office
Wages for assembly line workers
Depreciation on office equipment
Miscellaneous materials
Factory manager’s salary
Property taxes on factory building
Advertising for helmets
Sales commissions
Depreciation on factory building
	$	$	$	$

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