Question
In: Accounting
Kubin Company’s relevant range of production is 30,000 to 35,000 units. When it produces and sells...
Kubin Company’s relevant range of production is 30,000 to 35,000 units. When it produces and sells 32,500 units, its average costs per unit are as follows:
| Average Cost per Unit | ||
| Direct materials | $ | 9.00 |
| Direct labor | $ | 6.00 |
| Variable manufacturing overhead | $ | 3.50 |
| Fixed manufacturing overhead | $ | 7.00 |
| Fixed selling expense | $ | 5.50 |
| Fixed administrative expense | $ | 4.50 |
| Sales commissions | $ | 3.00 |
| Variable administrative expense | $ | 2.50 |
Required:
1. Assume the cost object is units of production:
a. What is the total direct manufacturing cost incurred to make 32,500 units?
b. What is the total indirect manufacturing cost incurred to make 32,500 units?
2. Assume the cost object is the Manufacturing Department and that its total output is 32,500 units.
a. How much total manufacturing cost is directly traceable to the Manufacturing Department?
b. How much total manufacturing cost is an indirect cost that cannot be easily traced to the Manufacturing Department?
3. Assume the cost object is the company’s various sales representatives. Furthermore, assume that the company spent $146,250 of its total fixed selling expense on advertising and the remainder of the total fixed selling expense comprised the fixed portion of the company's sales representatives’ compensation.
a. When the company sells 32,500 units, what is the total direct selling expense that can be readily traced to individual sales representatives?
b. When the company sells 32,500 units, what is the total indirect selling expense that cannot be readily traced to individual sales representatives?
Solutions
ekkarill92 answered 11 months agoRelated Solutions
Kubin Company’s relevant range of production is 30,000 to 35,000 units. When it produces and sells...
Kubin Company’s relevant range of production is 30,000 to 35,000
units. When it produces and sells 32,500 units, its average costs
per unit are as follows:
Average Cost per Unit
Direct
materials
$
9.00
Direct
labor
$
6.00
Variable
manufacturing overhead
$
3.50
Fixed
manufacturing overhead
$
7.00
Fixed selling
expense
$
5.50
Fixed
administrative expense
$
4.50
Sales
commissions
$
3.00
Variable
administrative expense
$
2.50
Required:
1. Assume the cost object is units of production:
a. What...
Kubin Company’s relevant range of production is 26,000 to 35,500 units. When it produces and sells...
Kubin Company’s relevant range of production is 26,000 to 35,500
units. When it produces and sells 30,750 units, its average costs
per unit are as follows:
Average Cost per Unit
Direct materials
$
8.60
Direct labor
$
5.60
Variable manufacturing overhead
$
3.10
Fixed manufacturing overhead
$
6.60
Fixed selling expense
$
5.10
Fixed administrative expense
$
4.10
Sales commissions
$
2.60
Variable administrative expense
$
2.10
Required:
1. Assume the cost object is units of production:
a. What...
Kubin Company’s relevant range of production is 25,000 to 33,500 units. When it produces and sells...
Kubin Company’s relevant range of production is 25,000 to 33,500
units. When it produces and sells 29,250 units, its average costs
per unit are as follows:
Average Cost per Unit
Direct materials
$
8.50
Direct labor
$
5.50
Variable manufacturing overhead
$
3.00
Fixed manufacturing overhead
$
6.50
Fixed selling expense
$
5.00
Fixed administrative expense
$
4.00
Sales commissions
$
2.50
Variable administrative expense
$
2.00
Required:
1. Assume the cost object is units of production:
a. What...
Kubin Company’s relevant range of production is 18,000 to 22,000 units. When it produces and sells...
Kubin Company’s relevant range of production is 18,000 to 22,000
units. When it produces and sells 20,000 units, its average costs
per unit are as follows:
Average Cost per Unit
Direct materials
$
7.00
Direct labor
$
4.00
Variable manufacturing overhead
$
1.50
Fixed manufacturing overhead
$
5.00
Fixed selling expense
$
3.50
Fixed administrative expense
$
2.50
Sales commissions
$
1.00
Variable administrative expense
$
0.50
Required:
1. Assume the cost object is units of production:
a. What...
Kubin Company’s relevant range of production is 28,000 to 31,500 units. When it produces and sells...
Kubin Company’s relevant range of production is 28,000 to 31,500
units. When it produces and sells 29,750 units, its average costs
per unit are as follows:
Amount per Unit
Direct materials
$
8.80
Direct labor
$
5.80
Variable manufacturing overhead
$
3.30
Fixed manufacturing overhead
$
6.80
Fixed selling expense
$
5.30
Fixed administrative expense
$
4.30
Sales commissions
$
2.80
Variable administrative expense
$
2.30
Required:
1. If 28,000 units are produced and sold, what is the variable...
Kubin Company’s relevant range of production is 16,000 to 24,500 units. When it produces and sells...
Kubin Company’s relevant range of production is 16,000 to 24,500
units. When it produces and sells 20,250 units, its average costs
per unit are as follows: Amount per Unit Direct materials $ 7.70
Direct labor $ 4.70 Variable manufacturing overhead $ 2.20 Fixed
manufacturing overhead $ 5.70 Fixed selling expense $ 4.20 Fixed
administrative expense $ 3.20 Sales commissions $ 1.70 Variable
administrative expense $ 1.20 Required: 1. If 16,000 units are
produced and sold, what is the variable cost...
Kubin Company’s relevant range of production is 14,000 to 20,500 units. When it produces and sells...
Kubin Company’s relevant range of production is 14,000 to 20,500
units. When it produces and sells 17,250 units, its average costs
per unit are as follows:
Direct materials
$
7.50
Direct labor
$
4.50
Variable manufacturing
overhead
$
2.00
Fixed manufacturing
overhead
$
5.50
Fixed selling expense
$
4.00
Fixed administrative
expense
$
3.00
Sales commissions
$
1.50
Variable administrative
expense
$
1.00
Required:
1. What is the incremental manufacturing cost incurred if the
company increases production from 17,250 to...
Kubin Company’s relevant range of production is 28,000 to 31,500 units. When it produces and sells...
Kubin Company’s relevant range of production is 28,000 to 31,500
units. When it produces and sells 29,750 units, its average costs
per unit are as follows:
Amount per Unit
Direct materials
$
8.80
Direct labor
$
5.80
Variable manufacturing
overhead
$
3.30
Fixed manufacturing
overhead
$
6.80
Fixed selling expense
$
5.30
Fixed administrative
expense
$
4.30
Sales commissions
$
2.80
Variable administrative
expense
$
2.30
Required:
1. What is the incremental manufacturing cost incurred if the
company increases...
Kubin Company’s relevant range of production is 27,000 to 29,000 units. When it produces and sells...
Kubin Company’s relevant range of production is 27,000 to 29,000
units. When it produces and sells 28,000 units, its average costs
per unit are as follows: Amount per Unit Direct materials $ 8.70
Direct labor $ 5.70 Variable manufacturing overhead $ 3.20 Fixed
manufacturing overhead $ 6.70 Fixed selling expense $ 5.20 Fixed
administrative expense $ 4.20 Sales commissions $ 2.70 Variable
administrative expense $ 2.20 5. If 27,000 units are produced, what
is the average fixed manufacturing cost per...
Kubin Company’s relevant range of production is 10,000 to 12,000 units. When it produces and sells...
Kubin Company’s relevant range of production is 10,000 to 12,000
units. When it produces and sells 11,000 units, its average costs
per unit are as follows:
Average Cost per Unit
Direct materials $7.10
Direct labor$4.10
Variable manufacturing overhead$1.60
Fixed manufacturing overhead$5.10
Fixed selling expense$3.60
Fixed administrative expense$2.60
Sales commissions$1.10
Variable administrative expense$0.60
Required:
1. For financial accounting purposes, what is the total amount of
product costs incurred to make 11,000 units?
2. For financial accounting purposes, what is the total...
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