Answer:
Noteworthy, Inc.
1. The total product cost for Noteworthy = $11,220
2. The prime cost for Noteworthy = $6,050
3. The manufacturing overhead for Noteworthy = $5,170
4. The direct labor for Noteworthy = $4,950
5. The conversion cost for Noteworthy = $10,120 ($4,950 + $5,170)
6. The total variable cost (with number of units produced as the activity) for Noteworthy = $8,220
7. The total fixed cost (with number of units produced as the activity) for Noteworthy = $6,200
Step-by-step explanation:
a) Data and Calculations:
Manufacturing Costs:
Direct
Speakers used in the keyboard $1,100
Wages of persons who install the speakers 3,000 )
Wages of person who attaches legs to keyboards 1,950 ) $4,950
Total direct or prime costs = $6,050
Indirect
Depreciation on factory equipment $800
Utilities for the factory 1,200
Production supervisor's salary 2,800
Glue and screws used in the keyboards 370
Total indirect or manufacturing overhead $5,170 $5,170
Total product cost for Noteworthy = $11,220
Administrative and Selling Costs:
Depreciation on CEO's company car $100
Personnel manager's salary 2,500
Cost to run an ad on local radio stations 600
Total administrative and selling costs = $3,200
Variable Costs:
Prime costs of materials and labor $6,050
Utilities for the factory 1,200
Glue and screws used in the keyboards 370
Cost to run an ad on local radio stations 600
Total variable costs = $8,220
Fixed Costs:
Depreciation on factory equipment $800
Production supervisor's salary 2,800
Depreciation on CEO's company car 100
Personnel manager's salary 2,500
Total fixed costs $6,200