Sodowsky Manufacturing Inc. produces brightly coloured clog-style shoes. For next year,
Sodowsky predicts that 150,000 units will be produced, with the following total costs:
|
Direct Materials
|
$ 300,000
|
|
Direct Labor
|
90,000
|
|
Variable Overhead
|
45,000
|
|
Fixed overhead
|
420,000
|
Required:
1. Calculate the prime cost per unit.
2. Calculate the conversion cost per unit.
3. Calculate the total variable cost per unit.
4. Calculate the total product (manufacturing) cost per unit.
5. What if the number of units increased to 165,000 and all unit variable costs stayedthe same? Explain what the impact would be on the following costs: total directmaterials, total direct labour, total variable overhead, total fixed overhead, unitprime cost, unit conversion cost. What would the product cost per unit be in thiscase?