Question

Dozier Company produced and sold 1,000 units during its first month of operations. It reported the following costs and expenses for the month: $77,000 $39,000 $18,200 30,400 $48,600 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Total manufacturing overhead Variable selling expense Fixed selling expense Total selling expense Variable administrative expense Fixed administrative expense Total administrative expense $13,600 21,200 $34,800 $ 4,800 26,600 $31,400 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)	total product cost				164,600	answer
	total period cost				66200	answer
	total product cost
	Direct materials				77,000
	direct labor				39,000
	total manufacturing overhead				48,600
	total product cost				164,600
	total period cost
	total selling expense				34,800
	total administrative expense				31,400
	total period cost				66,200
2)	total direct manufacturing cost				116,000	answer
	total indirect manufacturing cost				48600	answer
	total direct manufacturing cost
	direct materials				77,000
	direct labor				39,000
	total direct manufacturing cost				116,000
	total indirect manufacturing cost
	Variable manufacturing overhead				18,200
	fixed manufacturing overhead				30,400
	total indirect manufacturing cost				48,600
3a)	Total manufacturing cost
	Direct materials					77,000
	direct labor					39,000
	Manufacturing overhead
	Variable manufacturing overhead				18,200
	fixed manufacturing overhead				30,400	48,600
	total manufacturing cost					164,600	answer
b)	total nonmanufacturing cost
	total selling expense					34,800
	total administrative expense					31,400
	total non manufacturing cost					66,200	answer
c)	conversion cost
	direct labor					39,000
	Manufacturing overhead
	Variable manufacturing overhead				18,200
	fixed manufacturing overhead				30,400	48,600
	conversion cost					87,600	answer
	prime cost
	Direct materials					77,000
	direct labor					39,000
	prime cost					116,000	answer
4)	total variable manufacturing cost					134,200	answer
	total fixed cost					78,200	answer
	variable cost per unit produced and sold					152.60	answer
	total manufacturing cost
	direct materials					77,000
	direct labor					39,000
	variable manufacturing overhead					18,200
	total variable manufacturing cost					134,200
	fixed manufacturing overhead					30,400
	fixed selling expense					21,200
	fixed administrative expense					26,600
	total fixed cost					78,200
	variable cost per unit produced and sold
	direct materials					77,000
	direct labor					39,000
	variable manufacturing overhead					18,200
	variable selling expense					13,600
	variable administrative expense					4,800
	total variable cost (a)					152,600
	number of units produced and sold (b)					1,000
	variable cost per unit produced and sold					152.60
5)	incremental cost per unit produced					134.2	answer
	(134200/1000)*1