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Unformatted text preview: $134.5 3. I would predict the average cost to remain the same. Since Product Cost consists of Direct Materials (Materials Used) and Manufacturing Overhead (Indirect Materials + Factory Labor) and both are variable costs, I would expect the factory to use twice as little Direct materials to produce twice as little units; and adjust Indirect materials and Labor accordingly. 4. a. The neighbor would want to purchase at the products Prime Cost price and the president would want to add Manufacturing Overhead to the price. b. Cost of Goods Manufactured...
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This note was uploaded on 07/13/2009 for the course ACCOUNTING ACG2071 taught by Professor Pelt during the Spring '09 term at Gulf Coast Community College.
- Spring '09
- Managerial Accounting