Cost Classification Loring Company incurred the following costs last year: a. Di
ID: 2501117 • Letter: C
Question
Cost Classification Loring Company incurred the following costs last year: a. Direct materials, $216,000 b. Factory rent, $24,000 c. Direct labor, $120,000 d. Factory utilities, $6,300 e. Supervision in the factory, $50,000 f. Indirect labor in the factory, $30,000 g. Depreciation on factory equipment, $9,000 h. Sales commissions, $27,000 i. Sales salaries, $65,000 j. Advertising, $37,000 k. Depreciation on the headquarters building, $10,000 I. Salary of the corporate receptionist, $30,000 m. Other administrative costs, $175,000 n. Salary of the factory receptionist, $28,000Explanation / Answer
2) Product cost Direct Material 216000 Factory rent 24000 Direct labor 120000 Factory utilities 6300 Supervision In the factory 50000 Indirect labor in the factory 30000 Depriciation on factory equipment 9000 Salary of the factory receptionist 28000 Total Product cost 483300 3) Period Cost Sales commission 27000 Sales Salaries 65000 Advertising 37000 Depriciation on headquarters building 10000 Salary of the corporate receptionist 30000 other administrative costs 175000 Total period cost 344000 4) Unit product cost if 30000 units were produced = 483300/30000 = 16.1