P5-1A
Bjerg Company specializes in manufacturing a unique model of
bicycle helmet. The model is well accepted by consumers, and the company has
enough orders to keep the factory production at 10,000 helmets per month (80%
of its full capacity). Bjerg’s monthly manufacturing cost and other expense
data are as follows.
|
Rent on
factory equipment
|
$ 7,000
|
|
Insurance
on factory building
|
1,500
|
|
Raw
materials (plastics, polystyrene, etc.)
|
75,000
|
|
Utility
costs for factory
|
900
|
|
Supplies
for general office
|
300
|
|
Wages
for assembly line workers
|
43,000
|
|
Depreciation
on office equipment
|
800
|
|
Miscellaneous
materials (glue, thread, etc.)
|
1,100
|
|
Factory
manager’s salary
|
5,700
|
|
Property
taxes on factory building
|
400
|
|
Advertising
for helmets
|
14,000
|
|
Sales
commissions
|
7,000
|
|
Depreciation
on factory building
|
1,500
|
Marginal
check figures for parts of some problems, in most chapters, provide key numbers
to confirm that you are on the right track in your computations.DM $75,000DL $43,000MO $18,100PC $22,100
SOLUTION PREVIEW (The Solution is done in EXCEL TEMPLATE)
(a)
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Product Costs
|
|||||||
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Direct
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Direct
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Manufacturing
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Period
|
|||||
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Cost Item
|
Materials
|
Labor
|
Overhead
|
Costs
|
||||
|
Rent on factory
equipment
|
|
|
$7,000
|
|
||||
|
Insurance on factory
building
|
|
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1,500
|
|
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File name: P5-1A-Bjerg-Company.xls File type: application/vnd.ms-excel Price: $6
