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Problems 1 Problems

This document contains 4 accounting problems from an assignment. Problem 1 provides financial statement data for a company and requires calculating prime cost, conversion cost, total inventory cost, and total period cost. Problem 2 provides estimated unit cost data for a company and requires calculating total variable costs, variable cost per unit, total manufacturing cost, and manufacturing cost per unit. Problem 3 provides additional company data and requires calculating variable manufacturing cost per unit, variable cost per unit, full manufacturing cost per unit, and full cost to make and sell per unit. Problem 4 provides monthly production data for another company and requires using the high-low method to calculate the variable cost per machine hour, monthly fixed electricity costs, and total electricity costs for a projected number of machine

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Alyza Noeri Mercado
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6K views3 pages

Problems 1 Problems

This document contains 4 accounting problems from an assignment. Problem 1 provides financial statement data for a company and requires calculating prime cost, conversion cost, total inventory cost, and total period cost. Problem 2 provides estimated unit cost data for a company and requires calculating total variable costs, variable cost per unit, total manufacturing cost, and manufacturing cost per unit. Problem 3 provides additional company data and requires calculating variable manufacturing cost per unit, variable cost per unit, full manufacturing cost per unit, and full cost to make and sell per unit. Problem 4 provides monthly production data for another company and requires using the high-low method to calculate the variable cost per machine hour, monthly fixed electricity costs, and total electricity costs for a projected number of machine

Uploaded by

Alyza Noeri Mercado
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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QUEZON CITY UNIVERSITY

San Bartolome, Novaliches, Quezon City

ACCOUNTING 3
Pricing and Costing

ASSIGNMENT NO.1 4 problems


Problem: 1 4 POINTS
The financial statements of Mother Goose Company included these items:
Marketing costs 160,000.00
Direct labor cost 245,000.00
Administrative costs 145,000.00
Direct materials used 285,000.00
Fixed factory overhead costs 175,000.00
Variable factory overhead cost 155,000.00
Requirement:
Compute:
1. Prime cost
Direct Labor+ Direct Materials
Direct Labor Cost 245,000
Direct Material Used 285,000

​Prime Cost: ​530,000

2. Conversion cost
Direct Labor + Overhead Cost
Direct Labor Cost 245,000
Fixed Overhead Factory 175,000
Variable Factory Overhead 155,000

​Conversion Cost: ​575,000

3. Trotal invetoriavle /product cost


Direct Labor+ Direct Materials+Factory Overhead+Variable Overhead Direct
Materials Used 285,000
Direct Labor Used 245,000
Variable Factory Overhead 155,000
Fixed Factory Overhead 175,000

​Product Cost: ​860,000

4. Total period cost


Marketing+Delivery+ Admin,etc.
Admin Cost 145,000
Marketing Cost 160,000

​Total Period Cost: ​305,000

Problem: 2 4 POINTS
Blance Corporation estimated its unit costs of producing and selling 12,000
units per month as follows:
Direct materials used 32
Direct labor cost 20
Variable manufacturing overhead cost 15
Fixed manufacturing overhead cost 6
Variable marketing cost 3
Fixed marketing cost 4
Estimiated unit cost 80
Requirement:
Compute:
1. Total variable costs per month
(32+20+15+3)x12,000= ​840,000
2. Variable cost per unit produced
Direct Materials 32
Direct Labor 20 Variable Manufacturing
Overhead 15 Fixed Manufacturing Overhead 3

​Variable cost per unit produced: 70/unit

3. Total manufacturing cost


(32+20+15+6)x12,000= ​876,000

4. Manufacturing cost per unit


Direct Materials 32 Direct Labor
20 Variable Manufacturing Overhead 15
Fixed Manufacturing Overhead 6

Manufacturing per unit: ​73

Problem: 3 4 POINTS
CAR Corporation has the following facts, complete the requirements below: Sales
price 200.00 per unit Fixed cost:
Marketing and Administrative 24,000 per period
Manufacturing overhead 30,000 per period Variable cost:
Marketing and Administrative 6 per unit
Marketing overhead 9 per unit
Direct materials used 30 per unit
Direct labor cost 60 per unit
Units produced and sold 1,200 per period ​Requirement:
Compute:
1. Variable manufacturing cost per unit Direct
Materials used 30 Direct Labor Used 60

​Manufacturing cost per unit: ​90

2. Variable cost per unit


Direct Materials used 30 Direct Labor Used
60 Marketing and Administrative 6
Marketing Overhead 9

​ Variable cost per unit: ​105

3. Full manufacturing cost per unit


Direct Materials used 30 Direct Labor
60 (30,000/1,200) 25

Full Manufacturing Cost per unit 115

4. Full cost to make and sell per unit


Direct Materials used 30 Direct Labor used
60 Overhead 25
Marketing and Administrative 20 (24,000/1,200)
Variable M/A 6 Marketing Overhead
4
​Full Cost to make/sell per unit: 150

Problem: 4 3 POINTS
Westinghouse Company manufactures major appliances. Because of growing
interest it its product it has just had its most successful year. In preparing the
budget for next year, its controller compiled these data:
MONTH VOL. IN MACH. HRS ELECTRICITY COST ​July 6,000 60,000
Augsut 5,000 53,000 Sptember 4,500
49,500 october 4,000 46,000 November 3,500
42,500 December 3,000 39,000 ​6-MONTH TOTAL
26,000 290,000
Using the high-low method, compute :
1. The variable cost per machine hour
A. Variable Cost Component ​Highest Cost-Lowest
Cost ​Highest Hours-Lowest Hours

​60,000-39,000 ​6,000-3,000

​=7/Hour(Variable Component)

2. The monthly fixed electricity costs


60,000-(6,000x7)=18,000 39,000-(3,000x7)=​18,000 Fixed
Component

3. The total electricity costs if 4,800 machine hours are projected to be


used next month.

A. 4,800
(4,800x7)+18,000=​51,000

TOTAL POINT 15 POINTS

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