# vinyl total

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Unformatted text preview: .............. Vinyl ................................................................. Total ............................................................ Cost increase 10% .......................................... Cost of cushioned seat ............................. Cushion fabrication labor (\$7.50 × 0.5) ..................................................... Variable overhead (\$5.00 × 0.5) ..................................................... Total variable cost per cushioned seat .............. Total variable cost per 100-unit lot ..................... 342 \$1,329 540 \$1,869 \$ 2.40 4.00 \$ 6.40 × 1.10 \$ 7.04 3.75 2.50 \$13.29 \$1,329 10–32 Continued Overhead Analysis Supplies Indirect labor Supervision Power Heat and light Property taxes and insurance Depreciation Employee benefits: 20% Direct labor 20% Supervision 20% Indirect labor Total Variable Amount Per DLH Total \$ 420,000 \$1.40 375,000 1.25 Fixed Amount Total Per DLH \$ 250,000 140,000 0.47 200,000 1,700,000 180,000 \$0.83 0.67 5.67 0.60 450,000 1.50 75,000 \$1,500,000 0.25 \$5.00 50,000 \$2,340,000 0.16* \$7.80 *The per DLH amount for supervision has been adjusted down to \$0.16 to eliminate the rounding error between the sum of the amounts per DLH and the total divided by 300,000 DLH. Variable overhead rate = (\$1,500,000/300,000) = \$5.00 per DLH Fixed overhead rate = (\$2,340,000/300,000) = \$7.80 per DLH Opportunity cost: Labor hour constraint: DLH to make 100 deluxe office stools (1.50 × 100) Less: DLH to make 100 cushioned seats (0.50 × 100) Labor hours available for economy office stool Number of economy office stools 150 hours 50 hours 100 hours = 100 DLH/0.8 hours per stool = 125 stools 343 10–32 Concluded Opportunity cost calculation: Selling price Costs: Materials Labor Variable overhead Total costs CM/unit Units produced Total CM Deluxe Office Stool \$58.50 \$14.55 11.25 (\$7.50 × 1.5) 7.50 (\$5.00 × 1.5) \$33.30 \$25.20 × 100 \$2,520 Economy Office Stool \$41.60 \$15.76 6.00 (\$7.50 × 0.8) 4.00 (\$5.00 × 0...
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## This document was uploaded on 11/26/2013.

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