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16 July, 16:36

Devlin Manufacturing makes a single product. Expected manufacturing costs are as follows:Variable costsDirect materials $6.50 per unitDirect labor 2.40 per unitManufacturing overhead 1.10 per unitFixed costs per monthSupervisory salaries $13,600Depreciation 5,500Other fixed costs 2,200Determine the amount of manufacturing costs for a flexible budget level of 3,200 units per month.

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  1. 16 July, 18:14
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    Manufacturing cost: $

    Direct material ($6.50 x 3,200) 20,800

    Direct labour ($2.40 x 3,200) 7,680

    Manufacturing overhead ($1.10 x 3,200) 3,520

    Supervisory salaries 13,600

    Depreciation 5,500

    Other fixed costs 2,200

    Total manufacturing cost 53,300

    Explanation:

    Total manufacturing cost is the aggregate of direct material, direct labour, variable manufacturing overhead and fixed costs. Fixed costs include supervisory salaries, depreciation and other fixed costs. Direct material cost per unit, direct labour cost per unit and manufacturing overhead cost per unit should be multiplied by the budgeted units per month.
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