The following cost data for the year just ended pertain to Sentiments, Inc., a greeting card manufacturer: Direct material $ 2,300,000 Advertising expense 98,000 Depreciation on factory building 117,000 Direct labor: wages 500,000 Cost of finished goods inventory at year-end 115,000 Indirect labor: wages 141,000 Production supervisor’s salary 45,000 Service department costs* 100,000 Direct labor: fringe benefits 102,000 Indirect labor: fringe benefits 31,000 Fringe benefits for production supervisor 9,000 Total overtime premiums paid 55,000 Cost of idle time: production employees§ 40,000 Administrative costs 150,000 Rental of office space for sales personnel† 15,000 Sales commissions 4,000 Product promotion costs 10,000 *All services are provided to manufacturing departments. §Cost of idle time is an overhead item; it is not included in the direct-labor wages given above. †The rental of sales space was made necessary when the sales offices were converted to storage space for raw material. Compute d. Total product costs e. Total period costs
The following cost data for the year just ended pertain to Sentiments, Inc., a greeting card manufacturer: Direct material $ 2,300,000 Advertising expense 98,000 Depreciation on factory building 117,000 Direct labor: wages 500,000 Cost of finished goods inventory at year-end 115,000 Indirect labor: wages 141,000 Production supervisor’s salary 45,000 Service department costs* 100,000 Direct labor: fringe benefits 102,000 Indirect labor: fringe benefits 31,000 Fringe benefits for production supervisor 9,000 Total overtime premiums paid 55,000 Cost of idle time: production employees§ 40,000 Administrative costs 150,000 Rental of office space for sales personnel† 15,000 Sales commissions 4,000 Product promotion costs 10,000 *All services are provided to manufacturing departments. §Cost of idle time is an overhead item; it is not included in the direct-labor wages given above. †The rental of sales space was made necessary when the sales offices were converted to storage space for raw material. Compute d. Total product costs e. Total period costs
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter2: Basic Cost Management Concepts
Section: Chapter Questions
Problem 21E: Ellerson Company provided the following information for the last calendar year: During the year,...
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The following cost data for the year just ended pertain to Sentiments, Inc., a greeting card manufacturer:
Direct material | $ | 2,300,000 | |
Advertising expense | 98,000 | ||
117,000 | |||
Direct labor: wages | 500,000 | ||
Cost of finished goods inventory at year-end | 115,000 | ||
Indirect labor: wages | 141,000 | ||
Production supervisor’s salary | 45,000 | ||
Service department costs* | 100,000 | ||
Direct labor: |
102,000 | ||
Indirect labor: fringe benefits | 31,000 | ||
Fringe benefits for production supervisor | 9,000 | ||
Total overtime premiums paid | 55,000 | ||
Cost of idle time: production employees§ | 40,000 | ||
Administrative costs | 150,000 | ||
Rental of office space for sales personnel† | 15,000 | ||
Sales commissions | 4,000 | ||
Product promotion costs | 10,000 | ||
*All services are provided to manufacturing departments.
§Cost of idle time is an
†The rental of sales space was made necessary when the sales offices were converted to storage space for raw material.
Compute
d. Total product costs
e. Total period costs
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