CostS 1. Plastic for casing-$16,000 2. Wages of assembly workers-$84,000 3. Prop

ID: 2551972 • Letter: C

Question

CostS 1. Plastic for casing-$16,000 2. Wages of assembly workers-$84,000 3. Property taxes on factory-$4,000 4. Accounting staff salaries-$33,000 5. Drum stands (1,000 stands purchased)-$27,000 6. Rent cost of equipment for sales staff-$36,000 7. Upper management salaries-$140,000 8. Annual flat fee for factory maintenance service-$15, 0 9. Sales commissions-$20 per unit 10. Machinery depreciation, straight-line-$35,000 2. Calculate the manufacturing cost per drum set. TrueBeat Calculation of Manufacturing Cost per Drum S et For Year Ended December 31, 2017 Item Total cost Per unit cost Variable production costs Total variable production costs Fixed production costs Total fixed production costs Total production cost

Explanation / Answer

Answer:

DrumBeat

Calculation of Manufacturing Cost per Drum Set

For Year Ended December 31, 2017

Total cost

Item

(at 1,000 units)

Per unit cost*

Variable production costs

Plastic for casing

$16,000

$16

Wages of assembly workers

84,000

$84

Drum stands

27,000

$27

Total variable production costs

127,000

$127

Fixed production costs

Property taxes on factory

4,000

Annual fee for maintenance service

15,000

$15

Machinery depreciation

35,000

$35

Total fixed production costs

54,000

$54

Total production cost

$180,000

$180

*Total cost / 1,000 drum sets

Note:

Here in the question in the 5th line it was given that drum stand 1000 purchased so Total cost is divided by 1000 units

So Plastic for casing per unit cost

=16000/1000

=16