Exercise 6-17 (Part Level Submission) (a) SHOW SOLUTION SHOW ANSWER LINK TO TEXT

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Exercise 6-17 (Part Level Submission)

(a)

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(b)

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Exercise 6-17 (Part Level Submission)

Siren Company builds custom fishing lures for sporting goods stores. In its first year of operations, 2017, the company incurred the following costs.
Variable Costs per Unit Direct materials $7.88 Direct labor $3.62 Variable manufacturing overhead $6.09 Variable selling and administrative expenses $4.10 Fixed Costs per Year Fixed manufacturing overhead $234,070 Fixed selling and administrative expenses $220,605
Siren Company sells the fishing lures for $26.25. During 2017, the company sold 80,000 lures and produced 89,000 lures.

Explanation / Answer

a) Calculation of Manufacturing cost per unit

Variable Costing Direct Meterial $                      7.88 Direct Labour $                      3.62 Variable Manufactoring Overhead $                      6.09 Manufacturing cost per unit $                   17.59

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