Question

Leslie's Company applies manufacturing overhead based on the labor hours. Total labor hours are 800, and total manufacturing overhead cost is $8,000 for this month.Below is the information for job A in this month:The direct labor: 200 hours and $20 per hourDirect materials cost: $10,000Total units produced: 500What is the unit product cost for Job A?A $44 B $40 C $4 D $24 E $32

Answer 1

E $32

Step-by-step explanation:

Direct Labor: (200 x $20) $4,000

Direct Materials: $10,000

Factory Overhead: ($8,000 / 800 hrs x 200 hrs) $2,000

Total Cost Job A: $16,000

Unit Product Cost: $16,000 / 500 u = $32

Product cost is defined as the direct material, direct labor, and manufacturing overhead.