Question

Given the following information, compute the total number of units for the period:

Answer 1

Answer:

Total number of units produced for the period = 662 units

Explanation:

Total manufacturing cost = (Fixed overhead cost) + (Total direct labour cost) + (Total materials cost) + (Total Variable overhead cost)

Let the number of units produced be Q

Total manufacturing cost = $160705

Fixed overhead cost = $58000

Total direct labour cost = cost of direct labour per hour × number of direct labour hours = 2.7 × 13100 = $35370

Total direct materials cost = Direct material cost per unit × number of units produced = 75 × Q

Total variable overhead cost = 50% of total labour cost = 50% of 35370 = $17685

160705 = 58000 + 35370 + 75Q + 17685

75Q = 160705 - 58000 - 35370 - 17685

75Q = 49650

Q = 662 units