Question

Plasto Corporation manufactures a variety of plastic products, including a series of molded chairs. The three models of molded chairs, which are all variations of the same design, are Standard (can be stacked), Deluxe (with arms), and Executive (with arms and padding). The company uses batch manufacturing and has an operation-costing system. The production process includes an extrusion operation and subsequent operations to form, trim, and finish the chairs. Plastic sheets are produced by the extrusion operation, some of which are sold directly to other manufacturers. During the forming operation, the remaining plastic sheets are molded into chair seats and the legs are added; the Standard model is sold after this operation. During the trim operation, the arms are added to the Deluxe and Executive models and the chair edges are smoothed. Only the Executive model enters the finish operation where the padding is added. All of the units produced receive the same steps within each operation. The May production run had a total manufacturing cost of $988,290. The units of production and direct-material costs incurred were as follows:

     

	Units Produced		Extrusion Materials			Form Materials			Trim Materials			Finish Materials
Plastic sheets	4,800		$	62,400
Standard model	6,100			79,300		$	24,400
Deluxe model	3,300			42,900			13,200		$	9,900
Executive model	2,400			31,200			9,600			7,200		$	14,400
Total	16,600		$	215,800		$	47,200		$	17,100		$	14,400

   

Manufacturing costs applied during the month of May were as follows:

   

	Extrusion Operation				Form Operation				Trim Operation				Finish Operation
Direct labor		$	192,560			$	51,000			$	32,490			$	19,200
Manufacturing overhead			232,400				90,600				46,740				28,800

Required:

1. For each product produced by Plasto Corporation during the month of May, determine the (a) unit cost and (b) total cost. Be sure to account for all costs incurred during the month. (Round "Unit costs" to 2 decimal places.)

	Product Unit Costs Total Product Costs Plastic sheets Standard model Deluxe model Executive model Total $0

Answer 1

Conversion cosst per unit in each operation
			Extrusion	Forming	Trim	Finish
Direct labourr cost			192560	51000	32490	19200
manufacturing overheads			232400	90600	46740	28800
Total Conversion cost			424960	141600	79230	48000
Divide: Number of units produiced			16600	11800	5700	2400
				(16600-4800)	(11800-6100)	(5700-3300)
Conversion cost per unit in each operation			25.6	12	13.9	20
Unit Product cost:
			Plastic	Standard	Deluxe	Executive
Extrusion material			62400	79300	42900	31200
Form material				24400	13200	9600
Trim material					9900	7200
Finish Material						14400
Total material			62400	103700	66000	62400
Divide: Units produced			4800	6100	3300	2400
Material cost per unit			13	17	20	26
Conversion cost per unit
Extrusion			25.6	25.6	25.6	25.6
Forming				12	12	12
Triming					13.9	13.9
Finishing						20
Unit Product cost			38.6	54.6	71.5	97.5
Multiply: Unit produced			4800	6100	3300	2400
Total Product cost			185280	333060	235950	234000
Product		Unit cost	Total cost
Plastic sheet		38.6	185280
Standard		54.6	333060
Deluxe		71.5	235950
Executive		97.5	234000
Total			988290