Question

Tentacle Television Antenna Company provided the following manufacturing costs for the month of June. Direct labor cost Direct materials cost $140,000 83,000 Equipment depreciation (straight-line) Factory insurance Factory manager's salary Janitor's salary Packaging costs Property taxes 21,000 13,000 10,800 5,000 18,200 16,000 From the above information, calculate Tentacle's total fixed costs O A. $44,800 B. S60.800 OC. $65,800 OD, $307,000

Answer 1

C. $65,800

Step-by-step explanation:

Fixed csot: those which do not change for a relevant range with the production output. They aer constant.

Factory insurance 21,000

Factory insurance 13,000

Factory manager's salary 10,800

Janitor's salary 5,000

Property taxes: 16,000

Total Fixed Cost: 65,800

The direct materials and direct labor are variable cost as they drop to zero if no unit is produced.

Same goes with packaging cost, if no unit is produced then, no packagin is needed.