Morning Smiles Coffee Company manufactures Stoneware French Press coffee makers

Question

Morning Smiles Coffee Company manufactures Stoneware French Press coffee makers for use in dorm rooms, apartments, homes, and travel situations where customers de sire high-quality cofee in small amounts. Last week, direct materials (stoneware, paint, enamel, and steel) costing $100,000 were put into production. Direct labor of $18,000 (10 workers x 100 hours x $18 per hour) was incurred. Manufacturing overhead equaled $50,000. By the end of the week, Morning Smiles had manufactured 2,000 Stoneware French Press coffee makers.

Refer to the information for Morning Smiles Coffee Company above.

Required:

1. Calculate the total product cost for last week.

2. Calculate the-unit cost of one coffee maker that was produced last week.

Explanation / Answer

1. Calculate the total product cost for last week.

2) Unit cost = 168000/2000 = 84 per one coffee maker

Direct material 100000 Direct labour 18000 Manufacturing overhead 50000 Total Product cost 168000

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