Question

Kubin Company’s relevant range of production is 30,000 to 35,000 units. When it produces and sells 32,500 units, its average costs per unit are as follows:

  

	Average Cost per Unit
Direct materials	$	9.00
Direct labor	$	6.00
Variable manufacturing overhead	$	3.50
Fixed manufacturing overhead	$	7.00
Fixed selling expense	$	5.50
Fixed administrative expense	$	4.50
Sales commissions	$	3.00
Variable administrative expense	$	2.50

Required:

1. Assume the cost object is units of production:

a. What is the total direct manufacturing cost incurred to make 32,500 units?

b. What is the total indirect manufacturing cost incurred to make 32,500 units?

2. Assume the cost object is the Manufacturing Department and that its total output is 32,500 units.

a. How much total manufacturing cost is directly traceable to the Manufacturing Department?

b. How much total manufacturing cost is an indirect cost that cannot be easily traced to the Manufacturing Department?

3. Assume the cost object is the company’s various sales representatives. Furthermore, assume that the company spent $146,250 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representatives’ compensation.

a. When the company sells 32,500 units, what is the total direct selling expense that can be readily traced to individual sales representatives?

b. When the company sells 32,500 units, what is the total indirect selling expense that cannot be readily traced to individual sales representatives?
Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 3. Assume the cost object is the company's various sales representatives. Furthermore, assume that the company spent $146,250 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representatives' compensation. a. When the company sells 32,500 units, what is the total direct selling expense that can be readily traced to individual sales representatives? (Round per unit value to 2 decimal places.) b. When the company sells 32,500 units, what is the total indirect selling expense that cannot be readily traced to individual sales representatives? Show less A 3a. Sales commissions per unit Number of units sold 32,500 Total sales commission Fixed portion of sales representatives' compensation Total direct selling expense $ 0 3b. The total indirect selling expense < Required 2 Required 3

Answer 1

1.

1a
Direct material per unit	$9
Direct labor per unit	6
Total direct manufacturing cost per unit	15
Number of units	32,500
Total direct manufacturing costs	$487,500
1b.
Variable manufacturing overhead per unit	$3.50
Fixed manufacturing overhead per unit	7
Total indirect manufacturing cost per unit	10.50
Number of units	32,500
Total indirect manufacturing costs	$341,250

2.

2a.
Direct material per unit	$9
Direct labor per unit	6
Variable manufacturing overhead per unit	3.50
Fixed manufacturing overhead per unit	7
Total manufacturing costs per unit	25.5
Number of units	32,500
Total direct costs	$828,750
2b.
Total indirect cost	$0

3.

Sales commission per unit	$3
Number of units sold	32,500
Total sales commission	$97,500
Fixed portion of sales representatives compensation (32,500*$5.50-146,250)	32,500
Total direct selling costs	$130,000
3b.
Total indirect selling expense	$146,250

Answer 2

how to you calculate for 3b. the total indirect selling expense