ACC202-HW2 - Average cost per unit for rent on the factory

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1 Valenko Company COST OF GOODS MANUFACTURED Direct materials: Raw materials inventory, beginning $50,000 $260,000 Raw materials available for use $310,000 $40,000 Raw materials used in production $270,000 Direct labor $65,000 Manufacturing overhead: Insurance, factory equipment $8,000 Rent, factory building $90,000 Utilities, factory $52,000 Cleaning supplies, factory $6,000 Depreciation, factory equipment $110,000 Maintenance, factory $74,000 Total manufacturing overhead costs $340,000 Total manufacturing costs $675,000 $48,000 $33,000 Cost of goods manufactured $690,000 Valenko Company SCHEDULE OF GOODS SOLD Finished goods inventory, beginning $30,000 $690,000 Goods available for sale $720,000 less Finished goods inventory, ending $85,000 Cost of goods sold $635,000 2 Average cost per unit for direct materials used:$270,000÷30,000 units=$9.00 per unit
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Unformatted text preview: Average cost per unit for rent on the factory building:$90,00030,000 units=$3.00 per unit 3 Direct Materials: Rent, factory building: Per unit: $9.00(unchanged) Per unit: $90,00050,000 units=$1.80 pe Total: 50,000 units$9.00 per unit=$450,000 Total:$90,000(unchanged) 4 plus Purchases of raw materials less Raw materials inventory, ending plus Work in process, beginning less Work in process, ending plus Cost of goods manufactured Rents average cost per unit decreased from $3.00 to $1.80 due to the rise of production between the two years. Fixed costs dont change in total as the activity level changes, so the average cost of the unit will lower as the activity level increases. er unit...
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ACC202-HW2 - Average cost per unit for rent on the factory

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