Question

Quail Company builds snowboards. Quail Company has reported the following costs for the previous year. Assume no production inventories. Cost of fiberglass (raw material) $ 93,000 Factory rent $ 48,000 Advertising $ 123,000 Utilities for factory $ 15,000 Wages of assembly workers $ 86,000 Production supervisor salary $ 58,000 Sales manager salary $ 42,000 Factory property taxes $ 12,000 Depreciation on production equipment $ 29,000 Cost of bindings (raw material) $ 38,000 Screws $ 1,100 Wages of snowboard painters $ 82,000 Wages for maintenance workers $ 37,000
a. Compute the direct material costs.
b. Compute the direct labor cost.
c. Compute the manufacturing overhead.
d. Compute the total manufacturing cost.
e. Compute the prime cost.
f. Compute the conversion cost.
g. Compute the total period cost.

Answer 1

Answer:

a.the direct material costs= $ 131,000

b. the direct labor cost= $ 86,000

c. the manufacturing overhead= $ 282,100

d. the total manufacturing cost= $ 499,100

e.  the prime cost= $ 217,000

f.  the conversion cost= $ 368,100

g.  the total period cost== $ 165,000

Explanation:

a.The Direct Material Costs.

Fiber glass raw material          $ 93,000

Binding raw materials              $ 38,000

Direct material costs.                $ 131,000

b. The Direct Labor Cost.

Wages of assembly workers $ 86,000

c. The Manufacturing Overhead.

Screws                                          $ 1,100

Wages of snowboard painters $ 82,000

Wages for maintenance workers $ 37,000

Factory rent                                   $ 48,000

Utilities for factory                          $ 15,000

Factory property taxes                       $ 12,000

Depreciation on production equipment $ 29,000

Production supervisor salary                 $ 58,000

The Manufacturing overhead          $ 282,100

d. The Total Manufacturing Cost. = $ 131,000 +$ 86,000  +   $ 282,100

= $ 499,100

e.  The Prime cost = Direct Material + Direct Labor

                                = $ 131,000 +$ 86,000=  $ 217,000

f.  The Conversion Cost   = Direct Labor + FOH

                                           =$ 86,000  +   $ 282,100

                                           = $ 368,100

g.  The Total Period Cost.

Period Costs= Non manufacturing Costs

                   =   Sales manager salary $ 42,000+Advertising $ 123,000

                      = $ 165,000