Question

The Mahela Company specializes in producing sets of wooden patio furniture consisting of a table and four chairs. The company is currently operating at 80% of its full capacity of 3.600 sets per quarter Quarterly cost data at this level of operations follow. $126,00 51,690 41,600 5,100 88,080 Factory labour, direct Advertising Factory supervision Property taxes, factory building Sales commissions Insurance, factory Depreciation, office equipment Lease cost, factory equipment Indirect materials, factory Depreciation, factory building General office supplies (billing) General office salaries Direct materials used (wood, bolts, etc.) Utilities, factory 5,600 13,600 7,600 11,600 4,500 65.000 102.000 21,600 Required: 1. Enter the dollar amount of each cost item under the appropriate headings. As examples, this has been done already for the first two items in the preceding list. Note that each cost item is classified in two ways first, as variable or fixed, with respect to the number of units produced and sold, and, second, as a selling and administrative cost or a product cost. (If the item is a product cost, it should also be classified as either direct or indirect as shown) Cost Behaviour Selling and Administrative Variable Fixed Cost $ 126.000 51,600 51 600 Product Cost Direct Indirect 126 000 $ Cost Item Factory labour, direct Advertising Factory supervision Property taxes, factory building Sales commissions Insurance factory Depreciation office equipment Lease cost, factory equipment Indirect materials factory Depreciation factory building General office supplies (billing) General office salaries Direct materials used (wood, bolts, etc) Utilities factory Total costs "To units of product

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Answer 1

Peacoche Papel Cant behavior tarinble fixed Salling and Adminikaline last Cast Item Product Coast Direct Thdixect 11,26,000 Fachary Labney dist 1,26,000 51,600 41600 Aduertising 51,600 Jackeysambeuition 141600 Probusly to factory bola.comww.sim 88.000 5/00 5100 88000 Thamrong, factory 4100 4100 5600 5600 7600 73600 13600 Asberation, Afrie sidebar Indirect materials poche 7600 lease cast Depreciatia, forkay built berral office supplies 4600 Grande lice salaris Dixert mohua w 102.000 1/600 11600 4600 68000 68000 109000 utility factory 21600 21600 Total Cost 349800 201200 2 17800 228000 165200 Site Call vou

Peacoche The awerage / product Cost for me palio set could be. 2,28,000 Direct Cast (a) Indirect cost (6) 1,05,200 3,3 3,200 Total cast (ath) =(C) 3600 Total number of sets (gian) (d) Average product cast fex paitis.set. 92.55 re= Leyla Average broduct casts =$92.65 Rex fatio set Anwar is option (A) Increase dropping production by 3250 with there would be increase In Guerage product cost per set because of whits and thus there will be increase in auerage the fixed cost would be spread among less number Cast. 0.4. yes, the bresident ang may expect a minimum price of $92.55 Signature