Question

Kubin Company’s relevant range of production is 23,000 to 27,500 units. When it produces and sells 25,250 units, its average costs per unit are as follows:

  

	Average Cost per Unit
Direct materials	$	8.30
Direct labor	$	5.30
Variable manufacturing overhead	$	2.80
Fixed manufacturing overhead	$	6.30
Fixed selling expense	$	4.80
Fixed administrative expense	$	3.80
Sales commissions	$	2.30
Variable administrative expense	$	1.80

Required:

1. For financial accounting purposes, what is the total amount of product costs incurred to make 25,250 units?

2. For financial accounting purposes, what is the total amount of period costs incurred to sell 25,250 units?

3. For financial accounting purposes, what is the total amount of product costs incurred to make 27,500 units?

4. For financial accounting purposes, what is the total amount of period costs incurred to sell 23,000 units?

(For all requirements, do not round intermediate calculations.)

Answer 1

1
Direct materials	209575	=25250*8.3
Direct labor	133825	=25250*5.3
Variable manufacturing overhead	70700	=25250*2.8
Fixed manufacturing overhead	159075	=25250*6.3
Total amount of product costs	573175
2
Fixed selling expense	121200	=25250*4.8
Fixed administrative expense	95950	=25250*3.8
Sales commissions	58075	=25250*2.3
Variable administrative expense	45450	=25250*1.8
Total amount of period costs	320675
3
Direct materials	228250	=27500*8.3
Direct labor	145750	=27500*5.3
Variable manufacturing overhead	77000	=27500*2.8
Fixed manufacturing overhead	159075	=25250*6.3
Total amount of product costs	610075
4
Fixed selling expense	121200	=25250*4.8
Fixed administrative expense	95950	=25250*3.8
Sales commissions	52900	=23000*2.3
Variable administrative expense	41400	=23000*1.8
Total amount of period costs	311450