Closet Links Clothing Company provided the following manufacturing costs for the month of June. $\begin{array}{|l|r|}
\hline\text { Direct labor cost } & \$ 138,000 \
\hline \text { Direct materials cost } & 85,000 \
\hline \text { Equipment depreciation } & \
\text { (straight-line) } & 24,000 \
\hline \text { Factory insurance } & 19,000 \
\hline \text { Factory manager's salary } & 11,000 \
\hline \text { anitor's salary } & 3000 \
\hline \text { Packaging costs } & 19,200 \
\hline \text { Property taxes } & 14,000\
\hline
\end{array}$
From the above information,calculate Closet Link's total variable costs.

Question

Closet Links Clothing Company provided the following manufacturing costs for the month of June. $\begin{array}{|l|r|}
\hline\text { Direct labor cost } & \$ 138,000 \
\hline \text { Direct materials cost } & 85,000 \
\hline \text { Equipment depreciation } & \
\text { (straight-line) } & 24,000 \
\hline \text { Factory insurance } & 19,000 \
\hline \text { Factory manager's salary } & 11,000 \
\hline \text { anitor's salary } & 3000 \
\hline \text { Packaging costs } & 19,200 \
\hline \text { Property taxes } & 14,000\
\hline 
\end{array}$
 From the above information,calculate Closet Link's total variable costs.

Quizplus · Accepted Answer

Total variable costs include direct materials, direct labor, and variable overhead. 
From the provided information, the direct materials cost is $120,000, direct labor cost is $95,000 and the variable overhead cost is $27,200, giving us a total variable cost of $242,200. Thus, the correct answer is C.

Closet Links Clothing Company Provided the Following Manufacturing Costs for the Month