Dayton, Inc. manufactured 15,000 units of product last month and identified the

Question

Dayton, Inc. manufactured 15,000 units of product last month and identified the following costs associated with the manufacturing activity: Variable costs Direct materials used Direct labor Indirect materials and supplies Power to run plant equipment $ 1,094,000 2,000,000 234,000 213,000 Fixed costs: Supervisory salaries Plant utilities (other than power to run plant equipment) Depreciation on plant and equipment (straight-line, time basis) Property taxes on building 942,000 277,000 149,000 194,000 Required: Unit variable costs and total fixed costs are expected to remain unchanged next month. Calculate the unit cost and the total cost if 21,000 units are produced next month. (Round "Unit costs" to 2 decimal places.) Total variable costs Total fixed costs Total costs Unit costs

Explanation / Answer

Variable costs Direct materials used 1,094,000 Direct labor 2,000,000 Indirect materials and supplies 234,000 power to run plant Equipment 213,000 total variable cost 3,541,000 variable cost per unit   3541,000/15000 236.07 hence total vairable costs at 21,000 units = 236.07*21000 4957400 Total fixed cost Supervisory salaries 942,000 Plant utilities 277,000 Depreciation on plant 149,000 property taxes on building 194,000 Total fixed cost 1,562,000 total variable cost 4957400 total fixed cost 1,562,000 total costs 6519400 unit costs 310.45

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