Answer:
$65,750
Explanation:
Given:
Direct materials = $6.20
Direct labor = $3.70
Variable manufacturing overhead = $1.25
Fixed manufacturing overhead = $10,000
Sales commissions = $1.50
Variable administrative expense = $0.50
Fixed selling and administrative expense = $5,000
Number of unit Produced = 5,000 units
Calculation:
Production Cost = Direct Material cost + Direct labor cost + variable manufacturing overhead + Fixed manufacturing overheads.
= (5000 x $6.20) + (5000 x $3.70) + (5000 x $1.25) + $10,000
= ($31,000) + ($18,500) + ($6,250) + $10,000
= $65,750
Based on the information given the total amount of product costs incurred to make 5,000 units is closest to: $65,750.
Using this formula
Total product costs = Direct Material cost + Direct labor cost + variable manufacturing overhead + Fixed manufacturing overheads
Let plug in the formula
Total product costs = (5000 x $6.20) + (5000 x $3.70) + (5000 x $1.25) + $10,000
Total product costs = $31,000 + $18,500+ $6,250 + $10,000
Total product costs = $65,750
Inconclusion the total amount of product costs incurred to make 5,000 units is closest to: $65,750.
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