Sobota Corporation has provided the following partial listing of costs incurred during August:

Marketing salaries 51,700

Property taxes, factory 18,900

Adminstrative travel 100,800

Sales commissions 50,000

Indirect labor 45,000

Direct materials 168,100

Advertising 144,300

Depreciation of production equipment 42,200

Direct labor 90,800

Required:

a. What is the total amount of product cost listed above?

b. What is the total amount of period cost listed above?

a. $365,000

b. $346,800

Explanation:

The computations are shown below:

a. For product cost:

= Direct materials used + Direct labor + manufacturing overhead

where,

Manufacturing overhead = Indirect labor + Property taxes, factory + Depreciation of production equipment

= $45,000 + $18,900 + $42,200

= $106,100

So, the product cost would be

= $168,100 + $90,800 + $106,100

= $365,000

b. For period cost

= Marketing salaries + Administrative travel + Sales commissions + Advertising

= $51,700 + $100,800 + $50,000 + $144,300

= $346,800