Question

Problem 1-24 (Algo) Different Cost Classifications for Different Purposes [LO1-1, LO1-2, LO1-3, LO1-4, LO1-5]

Dozier Company produced and sold 1,000 units during its first month of operations. It reported the following costs and expenses for the month:

Direct materials				$	78,000
Direct labor				$	39,500
Variable manufacturing overhead	$	18,600
Fixed manufacturing overhead		30,700
Total manufacturing overhead				$	49,300
Variable selling expense	$	13,800
Fixed selling expense		21,600
Total selling expense				$	35,400
Variable administrative expense	$	4,900
Fixed administrative expense		26,800
Total administrative expense				$	31,700

Required:

1. With respect to cost classifications for preparing financial statements:

a. What is the total product cost?

b. What is the total period cost?

2. With respect to cost classifications for assigning costs to cost objects:

a. What is total direct manufacturing cost?

b. What is the total indirect manufacturing cost?

3. With respect to cost classifications for manufacturers:

a. What is the total manufacturing cost?

b. What is the total nonmanufacturing cost?

c. What is the total conversion cost and prime cost?

4. With respect to cost classifications for predicting cost behavior:

a. What is the total variable manufacturing cost?

b. What is the total fixed cost for the company as a whole?

c. What is the variable cost per unit produced and sold?

5. With respect to cost classifications for decision making:

a. If Dozier had produced 1,001 units instead of 1,000 units, how much incremental manufacturing cost would it have incurred to make the additional unit?

Answer 1

1) Cost Classification for Financial Statement Ja Total Prodcut Cost 166800 b) Total Period cost 67100 2) Cost Classification for Assign costs to cost objects Ja Direct Manufacturing Cost 117500 B Indirect Manifacturing Cost 49300 3) Cost Clasification for Manufacturer Total Direct Manufacturing Cost 166800 b) Total Non Manufacturing Cost 67100 c) Total Conversion Cost 88800 d) Total Prime cost 117500 4) Cost Clasification for Predicting Cost Behaviour Ja Total Varaible manufacturing Cost 136100 Total Fixed Cost 79100 Varaible Cost Per unit Prodcued and Sold 155 5) Incremental Manufacturing Cost 136

Direct Material Direct Labor Total Manufacturing Overhead 1A) Total Prodcut Cost 78000 39500 49300 166800 Total Selling Expenses Total Administrative Expenses 1B) Total Period cost 49300 35400 84700 Direct Material Direct Labor 2a) Direct Manufacturing Cost 78000 39500 117500 Total Manufacturing Overhead 2B) Indirect Manifacturing Cost 49300 49300

Direct Material 78000 Direct Labor 39500 Total Manufacturing Overhead 49300 3A) Total Direct Manufacturing Cost 166800 Total Selling Expenses Total Administrative Expenses 3B) Total Non Manufacturing Cost 49300 35400 84700| Direct Labor Total Manufacturing Overhead 3c) Total Conversion Cost 39500 49300 88800 Direct Material Direct Labor 3d) Total Prime Cost 78000 39500 117500

Direct Material 78000 Direct Labor 39500 Varaible Manufacturing Overhead 18600 4a) Total Varaible manufacturing Cos 136100 Fixed Manufacturing Overhead Fixed Selling Expenses Fixed Administrative Expenses 4B) Total Fixed Cost 30700 21600 26800 79100