Dozier Company produced and sold 1,000 units during its first month of operation

Question

Dozier Company produced and sold 1,000 units during its first month of operations. It reported the following costs and expenses for the month:

Required:

3. With respect to cost classifications for manufacturers:

a. What is the total manufacturing cost?

b. What is the total nonmanufacturing cost?

c. What is the total conversion cost and prime cost?

Direct materials $ 74,000 Direct labor $ 37,500 Variable manufacturing overhead $ 17,000 Fixed manufacturing overhead 29,500 Total manufacturing overhead $ 46,500 Variable selling expense $ 13,000 Fixed selling expense 20,000 Total selling expense $ 33,000 Variable administrative expense $ 4,500 Fixed administrative expense 26,000 Total administrative expense $ 30,500

Explanation / Answer

a) Total manufacturing cost Direct materials 74,000 direct labor 37,500 Manufacturing overhead Variable manufacturing overhead 17,000 fixed manufacturing overhead 29,500 46,500 total manufacturing cost 158,000 b) total nonmanufacturing cost total selling expense 33,000 total administrative expense 30,500 total non manufacturing cost 63,500 c) conversion cost direct labor 37,500 Manufacturing overhead Variable manufacturing overhead 17,000 fixed manufacturing overhead 29,500 46,500 conversion cost 84,000 prime cost Direct materials 74,000 direct labor 37,500 prime cost 111,500

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