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How much total manufacturing cost is an indirect cost

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Reference no: EM132622114

Kubin Company's relevant range of production is 12,000 to 16,000 units. When it produces and sells 14,000 units, its average costs per unit are as follows:

Average Cost per Unit 
Direct materials $7.30
Direct labor $4.30
Variable manufacturing overhead $1.80
Fixed manufacturing overhead $5.30
Fixed selling expense  $3.80
Fixed administrative expense $2.80
Sales commissions  $1.30
Variable administrative expense  $0.80

Required:

Problem 1. Assume the cost object is units of production:

a. What is the total direct manufacturing cost incurred to make 14,000 units?

b. What is the total indirect manufacturing cost incurred to make 14,000 units?

Problem 2. Assume the cost object is the Manufacturing Department and that its total output is 14,000 units.

a. How much total manufacturing cost is directly traceable to the Manufacturing Department?

b. How much total manufacturing cost is an indirect cost that cannot be easily traced to the Manufacturing Department?

Reference no: EM132622114

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