The Casual Furniture Company manufactures outdoor furniture and incurred the fol

Question

The Casual Furniture Company manufactures outdoor furniture and incurred the following costs during the month of January: Timber Paint Glue Wages-assembly personnel Wages-factory supervisor Factory cleaner's wages Sales commissions Administrative staff salaries Depreciation-factory equipment Depreciation-sales office equipment Utilities, insurance-factory Utilities, insurance-sales office Advertising Total costs $25 000 $5000 $500 $20000 S3500 $2000 $10000 $4000 $3000 $1000 S6000 $2000 $8000 $90000 The product costs are A. $90 000 B. $83 000 C. $65 000 D. $63 000

Explanation / Answer

Product costs only include the manufacturing costs. Timber 25000 Paint 5000 Glue 500 Wages-assembly Personnel 20000 Wages-Factory supervisor 3500 Factory cleaner's wages 2000 Depreciation-Factory Equipment 3000 Utilities, insurance factory- 6000 Total product costs 65000 Option C is correct

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