Question

Problem 10-1 (Part Level Submission) Blue Company specializes in manufacturing a unique model of bicycle helmet. The model is well accepted by consumers, and the company has enough orders to keep the factory production at 10,000 helmets per month (80% of its full capacity). Blue’s monthly manufacturing cost and other expense data are as follows. Rent on factory equipment $12,000 Insurance on factory building 1,650 Raw materials used (plastics, polystyrene, etc.) 84,900 Utility costs for factory 930 Supplies for general office 350 Wages for assembly line workers 58,300 Depreciation on office equipment 840 Miscellaneous materials (glue, thread, etc.) 1,230 Factory manager’s salary 5,800 Property taxes on factory building 430 Advertising for helmets 14,400 Sales commissions 10,120 Depreciation on factory building 1,660 Collapse question part (a) Prepare an answer sheet with the following column headings. Enter each cost item on your answer sheet, placing the dollar amount under the appropriate headings. Total the dollar amounts in each of the columns. Product Costs Cost Item Direct Materials Direct Labor Manufacturing Overhead Period Costs Rent on factory equipment $ $ $ $ Insurance on factory building Raw materials Utility costs for factory Supplies for general office Wages for assembly line workers Depreciation on office equipment Miscellaneous materials Factory manager’s salary Property taxes on factory building Advertising for helmets Sales commissions Depreciation on factory building $ $ $ $

Answer 1

Particulars	Amount In $
Direct Cost :
Raw material	84,900
Wages for assembly line workers	58,300
Utilities cost for factory	930
Total	144,130
Indirect Cost :
Rent on factory equipments	12,000
Insurance on factory building	1,650
Miscellaneous material	1230
Depreciation on factory building	1,660
Total	16,540
Sales and Admin Overheads :
Manager`s Salary	5,800
Property tax	430
Advertisement for helmets	14,400
Sales Commission	10,120
Supplies for general office	350
Depreciation on office equipments	840
Total	31,940
Total Cost	192,610