Question

Use the following costs per unit to identify the prime cost, total production cost and total cost for a product:

$ per unit

Direct materials: 12

indirect materials 6

direct labor 24

indirect labor 8

variable production overhead 10

variable selling and admin expense 5

fixed production overhead 12

fixed selling and admin expense 8

prime cost: total production cost total cost of product

a. 36 85 85

b. 72 72 85

c. 36 72 85

d. 36 22 72

Answer 1

Prime cost
Direct material		12
Direct labour		24
Prime cost		36
Total Production cost
Prime cst			36
Indirect material		6
Indirect labour		8
Variable Production OH	10
Fixed production oh		12
Total Production cost	72
Total cost of prodiuct
Total production cost	72
Variable selling admin expense	5
Fixed selling admin expenses	8
Total cost of prodiuct	85
Answer is C. 36; 72 ; 85