Question

Swifty Corporation uses job order costing for its brand new line of sewing machines. The cost incurred for production during 2019 totaled $27000 of materials, $18000 of direct labor costs, and $14000 of manufacturing overhead applied. The company ships all goods as soon as they are completed which results in no finished goods inventory on hand at the end of any year. Beginning work in process totaled $23000, and the ending balance is $17000. During the year, the company completed 25 machines. How much is the cost per machine?

Answer 1

$2,600

Step-by-step explanation:

Calculation to determine How much is the cost per machine

First step is to calculate the Total cost of making machines

Using this formula

Total cost of making machines

=Cost of materials +cost of direct labor+ manufacturing overhead cost+Beginning work in process-ending work in process

Let plug in the formula

Total cost per machine=$27000 +$18000 + $14000+$23000-$17000

Total cost per machine=$65,000

Now let calculate the cost per machine

Using this formula

Cost per machine

=Total cost of making machines /number of machines

Let plug in the formula

Cost per machine =$65,000/25

Cost per machine =$2,600

Therefore the Cost per machine is $2,600