please explain answers. thank you.
Direct materials Direct labor Manufacturing overhead Total manufacturing costs (a) Number of units to be produced (b) Estimated unit product cost (a) + (b) First Second Third Fourth $240,000 $120,000 $ 60,000 $180,000 128,000 64,000 32,000 96,000 300,000 220,000 180,000 ? $668,000 $404,000 $272,000 $ 2 BO,000 40,000 20,000 60,000 8.35 $ 10.10 $ 13.60 $ Management finds the variation in quarterly unit product costs to be confusing and difficult to work with. It has been suggest the problem lies with manufacturing overhead because it is the largest element of total manufacturing cost. Accordingly, you been asked to find a more appropriate way of assigning manufacturing overhead cost to units of product. Required: 1. Assuming the estimated variable manufacturing overhead cost per unit is $2.00, what must be the estimated total fixed manufacturing overhead cost per quarter? 2. Assuming the assumptions about cost behavior from the first three quarters hold constant, what is the estimated unit proc for the fourth quarter? 3. What is causing the estimated unit product cost to fluctuate from one quarter to the next? 4. Assuming the company computes one predetermined overhead rate for the year rather than computing quarterly overhea calculate the unit product cost for all units produced during the year. Direct materials Direct labor Manufacturing overhead Total manufacturing costs (a) Number of units to be produced (b) Estimated unit product cost (a) + (b) First Second Third Fourth $240,000 $120,000 $ 60,000 $180,000 128,000 64,000 32,000 96,000 300,000 220,000 180,000 ? $668,000 $404,000 $272,000 $ 2 BO,000 40,000 20,000 60,000 8.35 $ 10.10 $ 13.60 $ Management finds the variation in quarterly unit product costs to be confusing and difficult to work with. It has been suggest the problem lies with manufacturing overhead because it is the largest element of total manufacturing cost. Accordingly, you been asked to find a more appropriate way of assigning manufacturing overhead cost to units of product. Required: 1. Assuming the estimated variable manufacturing overhead cost per unit is $2.00, what must be the estimated total fixed manufacturing overhead cost per quarter? 2. Assuming the assumptions about cost behavior from the first three quarters hold constant, what is the estimated unit proc for the fourth quarter? 3. What is causing the estimated unit product cost to fluctuate from one quarter to the next? 4. Assuming the company computes one predetermined overhead rate for the year rather than computing quarterly overhea calculate the unit product cost for all units produced during the year
