Reference no: EM132671388
Question - St. Kilda Enterprises produces parts for the electronics industry. The production manager and cost analyst reviewed the accounts for the previous month and have provided an estimated breakdown of the fixed and variable portions of manufacturing overhead.
Fixed Variable Total
Indirect materials $3,800 $8,800 $12,600
Indirect labor 2,400 16,400 18,800
Supervision 9,800 3,400 13,200
Depreciation 36,800 4,800 41,600
Maintenance 16,800 21,800 38,600
Total $69,600 $55,200 $124,800
Direct materials for the month amounted to $101,500. Direct labor for the month was $196,500. During the month, 12,500 units were produced.
Required -
a. No changes are expected in these cost relations next month. The firm has budgeted production of 16,250 units. Provide an estimate for total production cost for next month.
b. Determine the cost per unit of production for the previous month and the next month.