Copley Enterprises manufactures digital video equipment.Each unit requires $1475 of direct material and $1500 of direct manufacturing labour at $30 per hour.Manufacturing overhead is applied at $35 per direct manufacturing labour hour.Calculate the cost of each unit.

Question

Quizplus · Accepted Answer

The cost of each unit includes direct material ($1475), direct manufacturing labour ($1500), and manufacturing overhead. The labour cost is $1500, which means 50 hours ($1500/$30 per hour). The overhead is $35 per hour, so for 50 hours, it is $1750 (50 hours * $35). Total cost = $1475 + $1500 + $1750 = $4725.

Copley Enterprises Manufactures Digital Video Equipment