When Bahalia Book case Company operates at a production and sales level of 2,000 units, the estimated unit costs are as follows:
Cost ItemEstimated Unit Cost
Lumber ..............................................$12
Direct labor ......................................... 2
Variable factory overhead ........................ 5
Fixed factory overhead ........................... 4
Variable marketing ................................ 1
Fixed marketing ................................... 3
Required:
(1) Calculate the estimated conversion cost per unit.
(2) Calculate the estimated prime cost per unit.
(3) Calculate the estimated variable manufacturing cost per unit.
(4) Calculate the estimated total variable cost per unit.
(5) Calculate the total cost that would be incurred during a month with a production level of 2,000 units and a sales level of 1,900 units.
(6) Give some examples of items that would be accounted for as indirect materials by Bahalia.
(7) In the list of cost items and estimated amounts provided, which entry includes an estimate of the costs referred to in the answer to requirement 6?