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Cost Formula The following amounts of various cost categories are experienced by Patton Manufacturing in producing and selling its only product: Direct material $14.00 per
Cost Formula The following amounts of various cost categories are experienced by Patton Manufacturing in producing and selling its only product: Direct material $14.00 per unit of product Direct labor $12.00 per direct labor hour* Manufacturing overhead $15,000 + $3.50 per direct labor hour Selling expenses $17,000+ $2.75 per unit of product Administrative $9,000 + $0.40 per unit of product *Each unit of product requires 1.5 direct labor hours. Combine the various cost factors into a general total cost formula for Patton Manufacturing and determine the total cost of producing and selling 25,000 units. Fixed costs + Variable costs = Total cost Direct material $ 0 $ $ 0 350,000 150,000 x 43,750 X 350,000 150,000 x 58,750 X 15,000 Direct labor Manufacturing overhead Selling expenses Administrative 68,750 17,000 9,000 41,000 85,750 19,000 10,000 772,500 x Total cost $ $ $ 813,500 X
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