PCB Corporation manufactures a single product. Monthly production costs incurred in the manufacturing process are shown...
PCB Corporation manufactures a single product. Monthly
production costs incurred in the manufacturing process are shown
below for the production of 3,357 units. The utilities and
maintenance costs are mixed costs. The fixed portions of these
costs are $336 and $224, respectively.
|
Production in Units |
3,357 |
|
|
Production Costs |
||
| Direct materials | $8,392 | |
| Direct labor | 20,142 | |
| Utilities | 2,350 | |
| Property taxes | 1,119 | |
| Indirect labor | 5,035 | |
| Supervisory salaries | 2,126 | |
| Maintenance | 1,231 | |
| Depreciation | 2,686 |
Calculate the expected costs when production is 5,595
units.
| Cost to produce 5,595 units |
$ |
Homework Answers
| Variable Cost | Fixed Cost per month | |
| Direct materials | 8392 | |
| Direct labor | 20142 | |
| Utilities ($2350 - $336) | 2014 | 336 |
| Property taxes | 1119 | |
| Indirect labor | 5035 | |
| Supervisory salaries | 2126 | |
| Maintenance ($1231 - $224) | 1007 | 224 |
| Depreciation | 2686 | |
| Total Cost $ | 36590 | 6491 |
| Number of units produced | 3357 | |
| Variable cost per unit $ | 10.90 |
The cost function is y = $6491 + $10.90x
Cost to produce 5595 units = $6491 + ($10.90 x 5595) = $6491 + $60985.50 = $67476.50
Amounts have been rounded off to 2 decimal places in the absence of specific instructions regarding the same. Kindly round off as required.
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