Seiko Manufacturing Company produced 1,200 units of inventory in January 2007. It expects to produce an additional 8,400 units during the remaining 11 months of the year. In other words, total production for 2007 is estimated to be 9,600 units. Direct materials and direct labor costs are \($64\) and \($52\) per unit, respectively. Seiko Company expects to incur the following manufacturing overhead costs during 2007:

Required:

a. Determine the cost of the 1,200 units of product made in January.

b. Is the cost computed in Requirement a actual or estimated? Could Seiko improve accuracy by waiting until December to determine the cost of products?

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Production supplies Supervisor salary Depreciation on equipment Utilities Rental fee on manufacturing facilities Total $ 4,800 192,000 144,000 36,000 96,000 $472,800