Raimondo Corporation makes one product and has provided the following information:The budgeted selling price per unit is $89. Budgeted unit sales for August is 8,300 units.Each unit of finished goods requires 4 pounds of raw materials. The raw materials cost $2.00 per pound.The direct labor wage rate is $21.00 per hour. Each unit of finished goods requires 2.6 direct labor-hours.Manufacturing overhead is entirely variable and is $7.00 per direct labor-hour.The estimated cost of goods sold for August is closest to:

Question

Quizplus · Accepted Answer

The cost of goods sold (COGS) is calculated by adding the costs of raw materials, direct labor, and manufacturing overhead. For 8,300 units: Raw materials cost = 8,300 units * 4 pounds/unit * $2.00/pound = $66,400. Direct labor cost = 8,300 units * 2.6 hours/unit * $21.00/hour = $452,760. Manufacturing overhead = 8,300 units * 2.6 hours/unit * $7.00/hour = $150,960. Total COGS = $66,400 + $452,760 + $150,960 = $670,120, which is closest to $670,640.

Raimondo Corporation Makes One Product and Has Provided the Following