Question

Item5 time remaining 2 hours 22 minutes 22 seconds02:22:22 item 5 time remaining 2 hours 22 minutes 22 seconds02:22:22 the accounting records of comacho company revealed the following costs, among others: factory insurance $ 32,000 raw material used 256,000 customer entertainment 15,000 indirect labor 45,000 depreciation on salespersons’ cars 22,000 production equipment rental costs 72,000 costs that would be considered in the calculation of manufacturing overhead total: multiple choice $149,000. $171,000. $186,000. $442,000. none of the answers is correct.

Answer 1

Manufacturing overhead consists of indirect costs such as factory insurance, indirect labor, and equipment rental. For Camacho company, the manufacturing overhead would total $149,000, excluding expenses not directly tied to manufacturing processes.

Step-by-step explanation:

The question revolves around the computation of manufacturing overhead for the Camacho company. In accounting, manufacturing overhead includes all the indirect costs associated with the production process. For Camacho company, the costs that would be considered as manufacturing overhead are factory insurance, indirect labor, depreciation on production equipment, and rental costs for production equipment.

Customer entertainment and depreciation on salespersons’ cars are not included because they are considered selling and administrative expenses, not manufacturing costs. Therefore, the total manufacturing overhead would be the sum of factory insurance ($32,000), indirect labor ($45,000), and production equipment rental costs ($72,000) yielding a total of $149,000.