Yellow Manufacturing Enterprise

Accounting manager Mr. White is responsible for calculating the costs of products manufactured at the Yellow Manufacturing Enterprise. Mr. White is able to determine the raw material and direct labor costs for each product separately.

In January, only automobile felt and carpet felt will be produced and sold at the factory. There is no stock of raw materials at the beginning of the semester. The raw material cost of 5,500 car seals to be produced in January has been budgeted at 1,100 $. Carpet felts are sold in rolls. The raw material cost of 2,000 rolls of carpet felt to be produced in January has been budgeted at 12,000 $.

Yellow manufacturing company was budgeted that 1,853 direct labor hours for automobile felt and 26,947 direct labor hours for carpet felt in January. The hourly wage of the workers is 4 $.

Since it is not possible to determine which product the overall production costs (GPM) occur for, these costs must be systematically distributed to the products. Mr. White calculates the limit of loading one general production cost for use in all products manufactured at the factory in the distribution of general production costs. In January, in order to calculate the general production cost of the loading capacity, Mr. White must determine the budgeted the general production cost for January and the budgeted machine time. Mr. White has determined the budgeted general production costs and summarized them as in Table 1:

Table 1: Budgeted General Production Costs for January

General Production Costs	Cost
Indirect Labor Costs	5.760	$
Machine Depreciation	3.000	$
Heat, Light, Energy	2.000	$
Maintenance And Repair	500	$
Factory Rent	4.000	$
TOTAL	15.260	$

The working time of the machines in operation for 1 month was determined as 1,920 machine hours. 1,920 mh. 123.5 mh of auto seal manufacturing, 1,796.5 mh. and the second one occurred for the manufacture of carpet felt.

Mr. White uses the general production cost loading limit calculated according to machine hours to distribute general production costs to automotive felt and carpet felt.

Mr. White calculates the total manufacturing cost for each product after calculating the raw materials, direct labor and the general production cost belonging to auto felt and carpet felt. Then it calculates the cost per unit by dividing the total manufacturing cost of each product by the amount of product produced.

Step 1: According to the traditional costing method, calculate the cost of 1 piece of automotive felt and 1 roll of carpet felt.