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Sobota Corporation has provided the following partial listing of costs incurred during August:

Marketing salaries 51,700
Property taxes, factory 18,900
Adminstrative travel 100,800
Sales commissions 50,000
Indirect labor 45,000
Direct materials 168,100
Advertising 144,300
Depreciation of production equipment 42,200
Direct labor 90,800
Required:

a. What is the total amount of product cost listed above?

b. What is the total amount of period cost listed above?

Respuesta :

Answer:

a. $365,000

b. $346,800

Explanation:

The computations are shown below:

a. For product cost:

= Direct materials used + Direct labor + manufacturing overhead

where,

Manufacturing overhead  = Indirect labor + Property taxes, factory + Depreciation of production equipment

= $45,000 + $18,900 + $42,200

= $106,100

So, the product cost would be

= $168,100 + $90,800 + $106,100

= $365,000

b. For period cost

= Marketing salaries + Administrative travel + Sales commissions + Advertising

= $51,700 + $100,800 + $50,000 + $144,300

= $346,800

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