Question

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Tik Tok Company manufactures customized coffee tables. The following relates to Job No. X10, an order...

Tik Tok Company manufactures customized coffee tables. The following relates to Job No. X10, an order for 150 coffee tables:

Direct materials used $22 800

Direct labour hours worked 600

Direct labour rate per hour $16.00

Machine hours used 400

Applied factory overhead rate per machine hour $30.00

a) What is the total manufacturing cost for Job No. X10?

b) Calculate the cost per coffee table for Job No. X10?

c) List two uses of this unit cost information to the managers at Tik Tok Company

Solutions

Expert Solution

Requirement a) What is the total manufacturing cost for Job No. X10?

Solution:- Total Manfacturing Cost for Job No. X10 = $44,400

Direct material used in Manufacturing $22,800
Direct Labor Cost (600 * 16) $9,600
Manufacturing overheads (400 * 30) $12,000
Total Manfacturing Cost (Job No. X10) $44,400

Requirement b) Calculate the cost per coffee table for Job No. X10?

Solution:- Cost per coffee table for Job No. X10 =

Total Manfacturing Cost (Job No. X10) $44,400
Number of Coffee table 150
Cost per coffee table for Job No. X10 (44,400 / 150) $296

Requirement c) List two uses of this unit cost information to the managers at Tik Tok Company

Solution:- Two uses of this unit cost are:-

1. Determination of selling price after calculating Markups .
2. Determination of process improvement initiatives by analysing different cost heads.

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ekkarill92 answered 2 years ago
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