Listed here are the total costs associated with the 2009 production of 700 drum sets manufactured by Roland. The drum sets sell for $600 each.
Required
1. Classify each cost and its amount as (a) either fixed or variable and (b) either product or period (the
last cost is completed as an example).
2. Compute the manufacturing cost per drum set.
Analysis Component
3. Assume that 1,000 drum sets are produced in the next month. What do you predict will be the total cost of plastic for the casings and the per unit cost of the plastic for the casings? Explain.
4. Assume that 1,000 drum sets are produced in the next month. What do you predict will be the total cost of property taxes and the per unit cost of the property taxes? Explain.
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