Question

Smiggly Enterprises makes Crocquet Sets. Consider the following cost information for the month of January (5,300 units were produced): Total Direct Materials $32,000 Total Direct Labor 44,500 Total Factory Overhead 7,500 Selling Expense 4,400

Executive Salaries 7,800
Calculate the Cost-per-Unit attributed to January's production.
a.$20.08 per unit
b.$14.22
c.$16.68
d.$15.85 per unit

Answer 1

The Cost-per-Unit for Smiggly Enterprises' production for the month of January is calculated by adding the total direct materials, direct labor, and factory overhead, then dividing by the number of units produced, resulting in $15.85 per unit.

Step-by-step explanation:

To calculate the Cost-per-Unit for Smiggly Enterprises' Croquet Sets produced in January, we consider only production costs, which include total direct materials, total direct labor, and total factory overhead. Selling expenses and executive salaries are not included in the cost of production.

Here is the calculation:

• Total Production Costs = Total Direct Materials + Total Direct Labor + Total Factory Overhead
• Total Production Costs = $32,000 + $44,500 + $7,500
• Total Production Costs = $84,000
• Cost-per-Unit = Total Production Costs ÷ Units Produced
• Cost-per-Unit = $84,000 ÷ 5,300 units
• Cost-per-Unit = $15.85

Therefore, the cost per unit for January's production is $15.85 per unit.