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1.For producing 200 units of product, a company uses $60,000 of direct materials, pays $470,000 of direct labor and incurs $20,000 and $60,000 variable overhead

1.For producing 200 units of product, a company uses $60,000 of direct materials, pays $470,000 of direct labor and incurs $20,000 and $60,000 variable overhead and fixed overhead, respectively. Compute the product unit cost assuming that 450 units are produced.

2.Loose Company is to submit a bid on the production of 22,500 ceramic plates. It is estimated that the cost of materials will be $26,000 and the cost of direct labor will be $30,000. Factory overhead is applied at $2.70 per direct labor hour in the Molding Department and at 35% of the direct labor cost in the Decorating Department. It is estimated that 2,000 direct labor hours, at a cost of $18,000 will be required in the Molding Department. The company wants a markup of 45% of its total production cost. How much will the company bid for the ceramic plates?

3. Hender Company revealed the following inventory transactions:

Jan. 1 Beginning balance, 16,000 units @$140

Jan. 5 Purchased 4,000 units @$150

Jan. 10 Issued 15,000 units to production

Jan. 15 Purchased 20,000 units @$160

Jan. 16 Returned 1,000 units to supplier from January 15 purchase

Jan. 25 Issued 8,000 units to production

Jan. 26 Production returned 4,000 units to storeroom from the January 25 issue

Jan. 31 Purchased 30,000 units @$150

What is the cost of the inventory on January 31 using FIFO method?

4.A job order for 500 units of children's party giveaways were processed with costs of $80,000 and $30,000 for direct materials and direct labor, respectively. Factory overhead was applied at 50% of direct labor cost which excludes a 5% provision for spoilage. Prior to transfer to the storeroom, 25 units were found to be spoiled with an estimated market value of $50 per unit.

a. What is the unit cost of the goods transferred to the storeroom if the loss is charged to total production?

b. Assuming that the 25 units were only defective and are not sold but instead reworked for total direct materials cost of $375 and total direct labor cost of $500. What is the unit cost of the goods transferred to storeroom if the rework costs are charged to the specific job?

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1 To compute the product unit cost assuming that 450 units are produced we need to calculate the total cost and then divide it by the number of units Given information Direct materials cost 60000 Dire... blur-text-image

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