Question

Assume Gasol Company has direct labor costs of $1,096, manufacturing overhead costs of $1,457 and prime costs of $3,242. What is Gasol's direct materials cost?

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Assume Gasol Company has direct materials cost of $2,661, direct labor costs of $1,018, manufacturing overhead costs of $1,362. What is Gasol's prime cost?

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Leonard, Inc., which uses a volume-based cost system, produces cat condos that sell for $104 each. Direct materials cost $11 per unit, and direct labor costs $23 per unit. Manufacturing overhead is applied at a rate of 180% of direct labor cost. Nonmanufacturing costs are $18 per unit.

What is the gross profit per unit for the cat condos? (Round your answer nearest whole dollar.)

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Job 101 has a direct materials cost of $1,100 and a total manufacturing cost of $2,600. Overhead is applied to jobs at a rate of 100 percent of direct labor cost.

What is the direct labor cost?

Answer 1

1) information given :

direct labor costs = $1096

manufacturing overhead costs = $1457 and

prime costs = $3242

prime costs = direct materials cost + direct labor costs

$3242 = direct materials cost + $1096

direct materials cost = $3242 - $1096 =$2146

2) information given :

direct materials cost = $2661

direct labor costs = $1018

manufacturing overhead costs = $1362

prime costs = direct materials cost + direct labor costs

prime costs =  $2661 + $1018 = $3679

3) infrmation given :

selling price per unit = $104

Direct materials cost = $11 per unit

direct labor costs = $23 per unit

Manufacturing overhead is applied at a rate of 180% of direct labor cost

Nonmanufacturing costs = $18 per unit

Manufacturing overhead = 180% of direct labor cost = 180% x $23 per unit = $41.4 or $41 (round in nearest whole dollar)

gross profit = selling price - Direct materials cost - direct labor costs - Manufacturing overhead

gross profit = $104 - $11 - $23 - $41 = $29

note - Nonmanufacturing costs is not deducted from sales to get gross profit.

4) information given :

direct materials cost = $1100

total manufacturing cost = $2600

Overhead is applied to jobs at a rate of 100 percent of direct labor cost

total manufacturing cost = direct materials cost + (direct labor costs + manufacturing overhead)

$2600 = $1100 +(direct labor costs + manufacturing overhead)

(direct labor costs + manufacturing overhead)= $2600 - $1100 = $1500

(direct labor costs + manufacturing overhead) = $1500

Overhead is applied to jobs at a rate of 100 percent of direct labor cost

so direct labor costs = manufacturing overhead

direct labor costs + manufacturing overhead = 100% + 100% = 200%

direct labor costs = $1500 x 100%/200% = $750

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