Quail Company builds snowboards. Quail Company has reported the following costs
ID: 2605898 • Letter: Q
Question
Quail Company builds snowboards. Quail Company has reported the following costs for the previous year. Assume no production inventories.
a. Compute the direct material costs.
b. Compute the direct labor cost.
c. Compute the manufacturing overhead.
d. Compute the total manufacturing cost.
e. Compute the prime cost.
f. Compute the conversion cost.
g. Compute the total period cost.
Cost of fiberglass (raw material) $ 94,000 Factory rent $ 49,000 Advertising $ 135,000 Utilities for factory $ 26,000 Wages of assembly workers $ 88,000 Production supervisor salary $ 50,000 Sales manager salary $ 34,000 Factory property taxes $ 29,000 Depreciation on production equipment $ 28,000 Cost of bindings (raw material) $ 23,000 Screws $ 2,500 Wages of snowboard painters $ 76,000 Wages for maintenance workers $ 31,000Explanation / Answer
a. Direct material cost: Cost of fibreglass 94000 Cost of bindings 23000 Direct material cost 117000 b. Direct labor cost: Wages for assembly workers 88000 Wages for snowboard painters 76000 Direct labor cost 164000 c. Manufacturing overhead: Factory rent 49000 Utilities for factory 26000 Production supervisor salary 50000 Factory property taxes 29000 Depreciation on production equipment 28000 Screws 2500 Wages for maintenance workers 31000 Manufacturing overhead 215500 d. Total manufacturing cost Direct material cost 117000 Direct labor cost 164000 Manufacturing overhead 215500 Total manufacturing overhead 496500 e. Prime cost Direct material cost 117000 Direct labor cost 164000 Prime cost 281000 f. Conversion cost Direct labor cost 164000 Manufacturing overhead 215500 Conversion cost 379500 g. Total period cost Advertising 135000 Sales manager's salary 34000 Total period cost 379500