Manufacturing costs per unit based on expected activity of 2

Manufacturing costs (per unit based on expected activity of 29,000 units or 55,100 direct labor hours): Direct materials (3.0 pounds at $8) Direct labor (1.9 hours at $80) Variable overhead (1.9 hours at $20) Fixed overhead (1.9 hours at $30) 24 152 38 57 Standard cost per unit 271 Budgeted selling and administrative costs: Variable Fixed 8 per unit $ 1,200,000 Expected sales activity: 25,000 units at $500 per unit Desired ending inventories: 16% of sales Assume this is the first year of operations for the Bellingham plant. During the year, the company had the following activity: Units produced Units sold Unit selling price Direct labor hours worked Direct labor costs Direct materials purchased Direct materials costs Direct material used Actual fixed overhead Actual variable overhead Actual selling and administrative costs 28,000 26,500 495 52,700 $ 4,268,700 88,000 pounds $ 704,000 88,000 pounds $ 900,000 $1,002,000 $ 2,100,000

Solution

Actual plant operating profit units sold 26,500 unit selling price 495 total sales    13,117,500.00 less :Variable costs direct materials costs        (704,000.00) direct labor costs    (4,268,700.00) Actual fixed overhead        (900,000.00) Actual variable overhead    (1,002,000.00) Actual selling and Administrative costs    (2,100,000.00) profit      4,142,800.00