 Business
14 August, 20:23

# PB1.LO 5.3The following product costs are available for Stellis Company on the production of erasers: direct materials, \$22,000; direct labor, \$35,000; manufacturing overhead, \$17,500; selling expenses, \$17,600; and administrative expenses; \$13,400.What are the prime costs?What are the conversion costs?What is the total product cost?What is the total period cost?If 13,750 equivalent units are produced, what is the equivalent material cost per unit?If 17,500 equivalent units are produced, what is the equivalent conversion cost per unit?

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1. 14 August, 20:36
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1. prime costs: direct materials+direct labour

= \$22,000+\$35,000

= \$57,000

2. Conversion Costs = Direct labour + Manufacturing Overheads

= \$35,000 + \$17,500

= \$52,500

3. Product Costs = direct material + direct labour + manufacturing overheads

= \$22,000 + \$ 35,000 + \$17,500

= \$74,500

4. Period Costs = Selling expenses + administrative expenses

= \$17,600 + \$13, 400

= \$31,000

If 13,750 equivalent units are produced, what is the equivalent material cost per unit = direct materials costs / unit produced

= \$22,000/13,750

= \$1.6 per unit

If 17,500 equivalent units are produced, what is the equivalent conversion cost per unit = total conversion costs/unit produced

= \$52,500/17,500

=\$3 per unit