Question

Ohno Company specializes in manufacturing a unique model of bicycle helmet. The model is well accepted by consumers, and the company has enough orders to keep the factory production at 10,000 helmets per month (80% of its full capacity). Ohno’s monthly manufacturing cost and other expense data are as follows. Rent on factory equipment $11,700 Insurance on factory building 2,100 Raw materials (plastics, polystyrene, etc.) 80,100 Utility costs for factory 1,000 Supplies for general office 400 Wages for assembly line workers 66,600 Depreciation on office equipment 900 Miscellaneous materials (glue, thread, etc.) 1,500 Factory manager’s salary 6,400 Property taxes on factory building 400 Advertising for helmets 15,000 Sales commissions 10,300 Depreciation on factory building 1,600

Enter each cost item on your answer sheet, placing the dollar amount under the appropriate headings. Total the dollar amounts in each of the columns. Product Costs Cost Item Direct Materials Direct Labor Manufacturing Overhead Period Costs Rent on factory equipment $ $ $ $ Insurance on factory building Raw materials Utility costs for factory Supplies for general office Wages for assembly line workers Depreciation on office equipment Miscellaneous materials Factory manager’s salary Property taxes on factory building Advertising for helmets Sales commissions Depreciation on factory building $ $ $ $

Compute the cost to produce one helmet. (Round answer to 2 decimal places, e.g. 15.25.) Production cost per helmet $

Answer 1