The accounting records for Portland Products report the following manufacturing costs for the past year. $ 320,000 269,000 231,000 Direct materials Direct labor Variable overhead Production was 190,000 units. Fixed manufacturing overhead was $742,000. For the coming year, costs are expected to increase as follows: direct materials costs by 20 percent, excluding any effect of volume changes; direct labor by 4 percent; and fixed manufacturing overhead by 10 percent. Variable manufacturing overhead per unit is expected to remain the same.
The accounting records for Portland Products report the following manufacturing costs for the past year. $ 320,000 269,000 231,000 Direct materials Direct labor Variable overhead Production was 190,000 units. Fixed manufacturing overhead was $742,000. For the coming year, costs are expected to increase as follows: direct materials costs by 20 percent, excluding any effect of volume changes; direct labor by 4 percent; and fixed manufacturing overhead by 10 percent. Variable manufacturing overhead per unit is expected to remain the same.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:The accounting records for Portland Products report the following manufacturing costs for the past year.
$ 320,000
269,000
231,000
Direct materials
Direct labor
Variable overhead
Production was 190,000 units. Fixed manufacturing overhead was $742,000.
For the coming year, costs are expected to increase as follows: direct materials costs by 20 percent, excluding any effect of volume
changes; direct labor by 4 percent; and fixed manufacturing overhead by 10 percent. Variable manufacturing overhead per unit is
expected to remain the same.
Required:
a. Prepare a cost estimate for a volume level of 152,000 units of product this year.
b. Determine the costs per unit for last year and for this year.
Complete this question by entering your answers in the tabs below.
Required A
Required B
Prepare a cost estimate for a volume level of 152,000 units of product this year. (Do not round intermediate calculations.)
Cost Item
This Year's Cost
Direct materials
Direct labor
Variable overhead
Fixed overhead
Total costs
$
%24
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