Question

10:44 Managerial Accounting Chapter 1... Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Required: 1. For financial accounting purposes, what is the total amount of product costs incurred to make 10,000 units? Explanation: Variable manufacturing overhead Number of Total the produced manufacturing Number of produced 2. For financial accounting purposes, what is the total amount of period costs incurred to sell 10.000 units? Explanation: Varese Velg dan perut Number of units pr e d sang ada e pen Total deling and d Total periodo ntact

Answer 1

1)

Direct materials	$6.00
Direct labor	3.50
Variable manufacturing overhead	1.50
Variable manufacturing overhead cost per unit	$11.00
Variable manufacturing cost per unit (a)	$11.00
Number of units produced (b)	10000
Total variable manufacturing cost (a)*(b)	$110000
Average fixed manufacturing overhead per unit (c)	$4.00
Number of units produced (d)	10000
Total fixed manufacturing cost (c)*(d)	$40000
Total product (manufacturing) cost (110000+40000)	$150000

2)

Sales commissions	$1.00
Variable administrative expense	0.50
Variable selling and administrative per unit	$1.50
Variable selling and administrative per unit (a)	$1.50
Number of units sold (b)	10000
Total variable selling and administrative expense (a)*(b)	$15000
Average fixed selling and administrative expenses per unit ($3 fixed selling +$2 fixed administrative) (c)	$5
Number of units sold (d)	10000
Total fixed selling and administrative expense (c)*(d)	$50000
Total period (non manufacturing) cost (15000+50000)	$65000

3)

Direct materials	$6.00
Direct labor	3.50
Variable manufacturing overhead	1.50
Sales commissions	1.00
Variable administrative expense	0.50
Variable cost per unit sold	$12.50

4)

Direct materials	$6.00
Direct labor	3.50
Variable manufacturing overhead	1.50
Sales commissions	1.00
Variable administrative expense	0.50
Variable cost per unit sold	$12.50

5)

Direct materials	$6.00
Direct labor	3.50
Variable manufacturing overhead	1.50
Sales commissions	1.00
Variable administrative expense	0.50
Variable cost per unit sold	$12.50

Variable cost per unit sold (a)	$12.50
Number of units sold (b)	8000
Total variable costs (a)*(b)	$100000