Answer:
The overall fixed monthly manufacturing expense totals $328,000.
Explanation:
For a production of 4000 units, direct material costs amount to $99.2 per unit, direct labor costs stand at $45.5 per unit, and manufacturing overhead costs equal $94.
For a production of 5000 units, direct materials remain at $99.2 per unit, direct labor is $45.5, and manufacturing overhead costs adjust to $77.6.
Total overhead for 4,000 units
= 
= $376,000
Total overhead for 5,000 units
= 
= $388,000
The variable cost per unit
= 
= $12 per unit
Fixed costs
= Total expenses - Total variable costs
= 
= $328,000
Answer:
$6,900
Explanation:
Using the incremental cost allocation technique, activities need to be prioritized regarding how costs will be assigned. Here, department 2 is identified as the main user, thus rental expenses should first be allocated to them at a rate of $25/hour.
Following this, department 1 uses the machine next, so 100 hours will be charged at the same rate as department 2, while an additional 200 hours will be billed at the reduced rate of $22/hour. The total rental charges for department 1 = (100 x $25) + (200 x $22) = $2,500 + $4,400 = $6,900
The answer and working steps for the exercise can be found in the attached documents. You will discover the procedures, formulas, or necessary details in the linked archive. If you have any questions, feel free to ask and I will be happy to clarify any doubts you may have.
Answer:
a) The company completes its inventory turnover at 1.5 times.
b) The per unit inventory cost for a product priced at $1000 is $166.67.
Explanation:
a) number of units sold = ($60000000/year)*(1 unit/$2000)
= 30000 units/year
COGS = 30000 units/year*$1000/unit
= $30000000/year
inventory = $20000000
flow time = inventory/flow rate
= $20000000/30000000 per year
= 0.67 years
inventory turns = 1/flow rate
= 1/(0.67)
= 1.5
Thus, the company turns its inventory at 1.5 times.
b) %inventory cost per device = 25%*0.6667 years
= 16.667%
16.667%*$1000 = $166.67 per unit
Hence, the per unit inventory cost for a product priced at $1000 amounts to $166.67.
