Mariposa Manufacturing builds custom wooden cabinets. Mariposa Manufacturing has reported the following costs for the previous year. Assume no production inventories. Advertising$70,000Cost of hardware (slides, handles, etc.)$34,000Cost of wood$117,000Depreciation on production equipment$63,000Factory property taxes$17,300Factory rent$76,000Glue$3,800Production supervisor salary$40,700Sales manager salary$41,600Utilities for factory$23,900Wages for maintenance workers$31,800Wages of assembly workers$91,400Wages of finishing workers$77,300Compute the following: a. Direct material costsb. Direct labor costc. Manufacturing overheadd. Total manufacturing coste. Prime costf. Conversion costg. Total period cost
What will be an ideal response?
a. Direct materials cost: $151,000 = $34,000 + $117,000
b. Direct labor cost: $168,700 = $91,400 + $77,300
c. Manufacturing overhead: $256,500 = $63,000 + $17,300 + $76,000 + $3,800 + $40,700 + $23,900 + $31,800
d. Total manufacturing cost: $576,200 = $151,000 + $168,700 + $256,500
e. Prime cost: $319,700 = $151,000 + $168,700
f. Conversion cost: $425,200 = $168,700 + $256,500
g. Total period cost: $111,600 = $70,000 + $41,600
Direct materials are the traceable material inputs. Direct labor is the cost of traceable labor. Manufacturing overhead includes all manufacturing costs other than direct materials and direct labor. Total manufacturing cost is the sum of direct labor, direct materials, and manufacturing overhead. Prime costs are direct materials and direct labor. Conversion costs are direct labor and manufacturing overhead. The nonmanufacturing costs are period costs.
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