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18 March, 20:08

If one unit of Product Z2 used $2.00 of direct materials and $3.40 of direct labor, sold for $11.00, and was assigned overhead at the rate of 25% of direct labor costs, how much gross profit was realized from this sale? (Round your intermediate calculations and final answer to two decimal places.)

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  1. 18 March, 23:59
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    Gross profit = $4.75

    Explanation:

    Giving the following information:

    Product Z2:

    $2.00 of direct materials

    $3.40 of direct labor.

    sold for $11.00.

    Designated overhead at the rate of 25% of direct labor costs.

    Gross profit = sales - direct material - direct labor - manufacturing overhead

    Gross profit = 11 - 2 - 3.4 - (3.4*0.25) = $4.75
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