Knight Company reports the following costs and expenses in May. From the informa

Question

Knight Company reports the following costs and expenses in May.

From the information, determine the total amount of:

Factory utilities $15,500 Direct labor $69,100 Depreciation on factory equipment 12,650 Sales salaries 46,400 Depreciation on delivery trucks 3,800 Property taxes on factory building 2,500 Indirect factory labor 48,900 Repairs to office equipment 1,300 Indirect materials 80,800 Factory repairs 2,000 Direct materials used 137,600 Advertising 15,000 Factory manager’s salary 8,000 Office supplies used 2,640

Explanation / Answer

Computation of Total amount of Manufacturing overhead

Factory utilities = 15500

Depreciation on factory equipment = 12650

Depreciation on delivery trucks = 3800

Indirect factory labor = 48900

Indirect materials = 80800

Factory managers salary = 8000

Property taxes on factory

building = 2500

Factory repairs = 2000

Total manufacturing overhead = 174150.

b. Computation of Total amount of Product costs

Product cost = 15500(factory utilities) + 12650 (depreciation factory equipment)+ 48900(indirect factory labor) + 80800(indirect materials) + 137600(direct materials) +69100(direct labor) + 2000(Factory repairs) = 366550.

c. Computation of Total amount of period cost

Period cost = depreciation factory equipment (12650) + depreciation on delivery truck (3800)+ factory managers salary(8000) + sales salaries(46400) + advertising (15000) = 85850.

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