Question

In: Accounting

Noteworthy, Inc., produces and sells small electronic keyboards. Assume that you have the following information about...

Noteworthy, Inc., produces and sells small electronic keyboards. Assume that you have the following information about Noteworthy’s costs for the most recent month.

Depreciation on factory equipment $ 850
Depreciation on CEO's company car 190
Speakers used in the keyboard 1,170
Production supervisor's salary 2,270
Glue and screws used in the keyboards 260
Wages of persons who install the speakers 2,840
Cost to run an ad on local radio stations 625
Utilities for the factory 1,250
Personnel manager's salary 2,580
Wages of person who attaches legs to keyboards 2,130
1. Calculate the total product cost for Noteworthy.
2. Calculate the prime cost for Noteworthy.
3. Calculate the manufacturing overhead for Noteworthy.
4. Calculate the direct labor for Noteworthy.
5. Calculate the conversion cost for Noteworthy.
6. Calculate the total variable cost (with number of units produced as the activity) for Noteworthy.
7. Calculate the total fixed cost (with number of units produced as the activity) for Noteworthy.

Solutions

Expert Solution

1. Total Production cost 10770
2. Prime cost 6140
3.Manufacturing overhead 4630
4.Direct labor 4970
5.Conversion cost 9600
6.Total variable cost 7650
7.Total fixed cost 6515
Workings:
Direct material
Speakers used in keyboard 1170
Direct labor
Wages of persons who instal speakers 2840
Wages of persons who attach legs to keyboard 2130
Total direct labor cost 4970
Manufacturing overhead
Depreciation on factory equipment 850
Production supervisors salary 2270
Glue and screws used in keyboard 260
Utilities for the factory 1250
Total manufacturing overhead 4630
Total product cost for the company
Direct material cost 1170
Direct labor cost 4970
Manufacturing overhead cost 4630
Total product cost 10770
Prime cost
Direct material cost 1170
Direct labor cost 4970
Prime cost 6140
Conversion cost
Direct labor cost 4970
Manufacturing overhead cost 4630
Conversion cost 9600
Total variable cost
Direct material 1170
Direct labor 4970
Glue and screws used in keyboard 260
Utilities for the factory 1250
Total variable cost 7650
Total fixed cost
Depreciation on factory equipment 850
Production supervisor salary 2270
Depreciation on CEO's company car 190
Cost to run ad on local radio station 625
Personnel manager's salary 2580
Total fixed cost 6515

ekkarill92 answered 2 years ago
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