BProblemsChapter 17-1 - Problem 17-2 Burtis Company...

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Problem 17-2: Burtis Company Calculation of normal selling price for 20x3 assuming continued use of full cost: 20x2 Increase 20x3 Direct material ......................................................................................................................................................................... $ 4.00 $ .48* $ 4.48 Direct labor .............................................................................................................................................................................. 7.00 .84* 7.84 Indirect manufacturing ............................................................................................................................................................. 4.80 .60 5.40 Selling and administrative ........................................................................................................................................................ 3.50 .00 3.50 Total full cost ................................................................................................. ........................................................................................................................................................................................... 19.30 1.92 21.22 Profit (10%) ............................................................................................................................................................................. 1.93 .19 2.12 Selling price ............................................................................................................................................................................. $21.23 $2.11 $23.34 *12 percent increase for direct material (.12 x $4.00 = $.48) and for direct labor (.12 x $7.00 = $.84) $6,000 increase with volume of 10,000 units = increase of $.60 per unit. Problem 17-3: Micha Smith a. Fee per hour = hours 150 $3,300 profit Desired $5,700 costs Total + = $60.00 per hour b. Revenue, 100 hours @ $60 ................................................................................................................................ $6,000 Costs .................................................................................................................................................................. 5,700 Profit .................................................................................................................................................................. $ 300 Problem 17-4: Valade Company a. Calculation of selling prices: Total Company Product ___J ___ Product ___K ___ Direct manufacturing cost ........................................................................................................................................................ $ 700,000 $400,000 $300,000 Indirect manufacturing cost ...................................................................................................................................................... 280,000 160,000 120,000 Selling and administrative cost .................................................................................................................................................
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