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12 September, 23:21

Sobota Corporation has provided the following partial listing of costs incurred during August:

Marketing salaries 51,700

Property taxes, factory 18,900

Adminstrative travel 100,800

Sales commissions 50,000

Indirect labor 45,000

Direct materials 168,100

Advertising 144,300

Depreciation of production equipment 42,200

Direct labor 90,800

Required:

a. What is the total amount of product cost listed above?

b. What is the total amount of period cost listed above?

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Answers (1)
  1. 13 September, 01:01
    0
    a. $365,000

    b. $346,800

    Explanation:

    The computations are shown below:

    a. For product cost:

    = Direct materials used + Direct labor + manufacturing overhead

    where,

    Manufacturing overhead = Indirect labor + Property taxes, factory + Depreciation of production equipment

    = $45,000 + $18,900 + $42,200

    = $106,100

    So, the product cost would be

    = $168,100 + $90,800 + $106,100

    = $365,000

    b. For period cost

    = Marketing salaries + Administrative travel + Sales commissions + Advertising

    = $51,700 + $100,800 + $50,000 + $144,300

    = $346,800
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