In: Accounting
Question 1.
Case 1. Book Problem . The Ohno Company is a manufacturer of laptop computers. Ohlo’s monthly manufacturing cost and other expenses data are as follows:
Required:
The company intends to classify the above costs and expenses into the following categories:
1) Prime costs 2) Conversion costs 3) Factory overhead 4) Period costs
Use the table below and record the amount in the appropriate column category.
Cost Item |
Cost |
Prime cost |
Conversion Cost |
Factory Overhead |
Period Costs |
|
Rent on Factory equipment |
11,000 |
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Insurance on factory building |
1,500 |
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Raw materials |
75,000 |
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Sales Commissions |
10,000 |
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Utility costs for factory |
900 |
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Supplies for general office |
300 |
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Wages for assembly line workers |
58,000 |
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Depreciation on office equipment |
800 |
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Miscellaneous materials (Glue etc.) |
1,100 |
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Factory manager’s salary |
5,700 |
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Property taxes on factory building |
400 |
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Advertising for the laptops |
14,000 |
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Office Supervisor Salary |
16,000 |
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Depreciation of factory building |
1,500 |
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