Answer and Explanation:
The preparation of the answer sheet is presented below;
<u>Product Costs
</u>
<u>
Cost Item Direct Direct Manufacturing Period
</u>
<u> Materials Labor Overhead Costs
</u>
Rent on factory
equipment $11,500
Insurance
on factory building $1,780
Raw materials $80,800
Utility costs for factory $920
Supplies for general office $320
Wages for
assembly line workers $59,700
Depreciation on office equipment $830
Miscellaneous materials $1,470
Factory manager’s salary $6,200
Property taxes on factory building $420
Advertising for helmets $14,900
Sales commissions $10,900
Depreciation on factory building $1,640
<u>Total $80,800 $59,700 $23,930 $26,950 </u>
Now cost to produce one helmet is
= Total cost to produced ÷ number of helmets produced
= ($80,800 + $59,700 + $23,930) ÷ (10,000)
= ($164,430) ÷ (10,000)
= $16.44
