Question
Background: Play and Stay Manufacturing(P&S) has a factory that produces cabinetry for the RV and marine market. The company has other product lines. Materials and
Background: Play and Stay Manufacturing(P&S) has a factory that produces cabinetry for the RV and marine market. The company has other product lines. Materials and labor for the cabinets are determined by each job. To simplify the assignment, we will assume the following average costs The following information highlights P&S Manufacturings cost structure for 2020.
- The materials include $2,800 for the wood and other materials on a per job basis.
- It requires 24 hours of labor on average for the cabinetry. The hourly rate is $11.
- The sales price will be set at a markup of 80%.
- The company estimates that it will have 43,200 direct labor hours in total for the cabinets.
- It assumes 1800 units are sold on average per year.
A breakdown of estimated yearly costs related to the cabinetry follows:
Salaries- office & administrative $ 500,000
Salaries for factory personal $ 350,000
Office Rent $ 150,000
Factory Rent $ 30,000
Office utilities and Misc office expenses(based on units sold) $ 15,000
Sales travel(based on units sold) $ 24,000
Insurance - office $ 12,000
Depreciation - office equipment $ 40,000
Depreciation for factory equipment $ 70,000
Advertising $ 20,000
Sales commissions(based on units sold) $ 50,000
Factory Property taxes $ 25,000
Maintenance for factory equipment $ 80,000
Question1 : Prepare a Job Order Cost sheet for the following custom project: Materials $6,000 and 30 hours of labor. Calculate the sales price based on your cost calculations. Do not use these numbers for any other calculation. Please show any excel formulas needed as well.
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