Chapter 18, Problem 9QS

To determine

Introduction:

Manufacturing Costs:

The costs incurred in the production process of finished product refers to manufacturing costs. The cost is associated only with the manufacturing of a product. The production costs include direct and indirect costs.Direct Material, direct labor and manufacturing overhead are three categories of manufacturing cost that are described briefly as below:

Direct Material: It refers to the cost of raw materials used in the production process that becomes finished goods.

Direct Labor: The cost of wages paid to the labor who is physically involved in converting raw materials to finished goods.

Manufacturing Overheads: It refers to all indirect costs of finished goods that are not directly involved in the process of production. Example: Supervisor Salary, depreciation on factory equipment, rent on factory building etc.

To calculate:

The total manufacturing costs of goods for a manufacturer with the given information.