Question

Accounting 203 Quiz #1 Name Miller Company's total sales are $140,000. Total selling and administrative expenses are $18,000. The company maintains no beginning or ending inventories and its manufacturing overhead costs are entirely fixed costs. Cost Relationships: (1) The company's direct labor cost is $15,000, which represents 30% of its total conversion cost. (2) The $15,000 direct labor cost also represents 40% of total prime cost. (3) The only variable selling and administrative expense is sales commission which is 5% of total sales. Required: 1. What is the total manufacturing overhead cost? 2. What is the total direct materials cost? 3. What is the total manufacturing cost? 4. What is the total variable selling and administrative cost? 5. What is the total variable cost? 6. What is the total contribution margin, when sales are $140,000?

Answer 1

PageNO Anşwen - Given that, Total Saleş $ 140,000 administrati ve expenşed = $ 18,000 Requisu d. The total manufacturing ovenhead Cost Disect labor Coşt = $15,0o00 Pencentage of dabor Coşt im total Gonverşion Coşt 30% Total Conves Sation Cost Iso00 15000 X 100 30 500 x 100 50,000

PageNo @ ovenihead cast Total Marufacturing * Total Conveasion cost - Disect labor Cost 50,000 - 15,000 35,000 Total Hanufactoring ovenihaad Cost =435,000 ) The total diorect matesials Coşt. Diauct labor Cost - $ 15,000 Pencentage of labor coşt In total Parime Cost Total Paimé Co&t 15000 40% 15000 X100 40 375x100 = 34,50O

Pagene@ Total Dioed Mate nial Cost Total paime coşt- Dimecd la bor Cast 37,500 - 15,000 22,500 Total Dioeet Hategial Cost= $ 22,500 3 Total Manufactuwing Cost Coât Disuct labor Coşt $ 15,000 Disect Hatenial cost = $ 22,500 Marafactuning oveshead Cost = $35,000 * Total Mamufactusing Coất: Disuct la bor Co&t + Dioud Hademial Cost + Marutactuning Mandiacharing Ovcorhead Co st $35,00 $15, 000 + $aa,500 + 0 =$+2, 500

Pageva@ Tetal Mamubouctoring $4a ,500 Coşt 4) The total viable şellimg and adminiştraive Cost Total Şales $ l40,000 Variable Selling and administrative Cost 5Y. * l4000 X 140000 100 = 4000 the total voniable selling and admi nistrative $4,000 Coşt 5) Total Varriable Coşt : Diauct mateial Cost = $ a2,500 Didect labor Coşt = $ 15,000 Voniable Şelling and adminiși ratiwe Cost = $4,000

Total voria ble cost - Dioect Haterial Cost + gelling Diorect Labor Cost + Voriable and adminiştvative Coşt $ 22, 500 + $ 15,000 + $,000 -$ u4, 500 Total vooriable Cost = $ 44,500 Total Cont ribut ion margim, whn Saled are $ 140, 000 Total Sales = (40,000 Total Variable Coşt $ u4, S00 Total Contribution Total şales- iotal Variable Caşi = $140,000 - $44,500 Total Contribution = $95,500