Kubin Company’s relevant range of production is 29,000 to 33,000 units. When it produces and sells 31,000...

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Accounting

Kubin Company’srelevant range of production is 29,000 to 33,000 units. When itproduces and sells 31,000 units, its average costs per unit are asfollows:

Average Cost per Unit
Directmaterials $ 8.90
Directlabor $ 5.90
Variablemanufacturing overhead $ 3.40
Fixedmanufacturing overhead $ 6.90
Fixed sellingexpense $ 5.40
Fixedadministrative expense $ 4.40
Salescommissions $ 2.90
Variableadministrative expense $ 2.40
Required:
1. For financialaccounting purposes, what is the total amount of product costsincurred to make 31,000 units?
2. For financialaccounting purposes, what is the total amount of period costsincurred to sell 31,000 units?
3. For financialaccounting purposes, what is the total amount of product costsincurred to make 33,000 units?
4. For financialaccounting purposes, what is the total amount of period costsincurred to sell 29,000 units?

Answer & Explanation Solved by verified expert

3.6 Ratings (322 Votes)

Req 1.
Total Product cost of 31000 units:
Material	(31000*8.90)	275900
Labour	(31000*5.90)	182900
variable manufacturing OH	(31000*3.40)	105400
Fixed manufacturing Oh	(31000*6.90)	213900
Total Product cost of 31000 units:		778100

Req 2.
Total Period cost of 31000 uits:
Fixed selling expnse (31000*5.40)		167400
Fixed Admin expense (31000*4.40)		136400
Sales commission (31000*2.90)		89900
Variable Admin (31000*2.40)		74400
Total Period cost of 31000 units:		468100

Req 3.
Total Product cost of 33000 units:
Material	(33000*8.90)	293700
Labour	(33000*5.90)	194700
variable manufacturing OH	(33000*3.40)	112200
Fixed manufacturing Oh	(31000*6.90)	213900
Total Product cost of 33000 units:		814500

Req 4.
Total Period cost of 29000 uits:
Fixed selling expnse (31000*5.40)		167400
Fixed Admin expense (31000*4.40)		136400
Sales commission (29000*2.90)		84100
Variable Admin (29000*2.40)		69600
Total Period cost of 29000 units:		457500

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Transcribed Image Text

Kubin Company’srelevant range of production is 29,000 to 33,000 units. When itproduces and sells 31,000 units, its average costs per unit are asfollows: Average Cost per UnitDirectmaterials$8.90Directlabor$5.90Variablemanufacturing overhead$3.40Fixedmanufacturing overhead$6.90Fixed sellingexpense$5.40Fixedadministrative expense$4.40Salescommissions$2.90Variableadministrative expense$2.40Required:1. For financialaccounting purposes, what is the total amount of product costsincurred to make 31,000 units?2. For financialaccounting purposes, what is the total amount of period costsincurred to sell 31,000 units?3. For financialaccounting purposes, what is the total amount of product costsincurred to make 33,000 units?4. For financialaccounting purposes, what is the total amount of period costsincurred to sell 29,000 units?

	Average Cost per Unit
Directmaterials	$	8.90
Directlabor	$	5.90
Variablemanufacturing overhead	$	3.40
Fixedmanufacturing overhead	$	6.90
Fixed sellingexpense	$	5.40
Fixedadministrative expense	$	4.40
Salescommissions	$	2.90
Variableadministrative expense	$	2.40