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Homework answers / question archive / Ohno Company specializes in manufacturing a unique model of bicycle helmet
Ohno Company specializes in manufacturing a unique model of bicycle helmet. The model is well accepted by consumers, and the company has enough orders to keep the factory production at 10,000 helmets per month (80% of its full capacity). Ohno's monthly manufacturing cost and other expense data are as follows.
Rent on factory equipment $11,100 Insurance on factory building 1,600 Raw materials (plastics, polystyrene, etc.) 75,100 Utility costs for factory 900 Supplies for general office 300 Wages for assembly line workers 58,100 Depreciation on office equipment 800 Miscellaneous materials (glue, thread, etc.) 1,200 Factory manager's salary 5,800 Property taxes on factory building 400 Advertising for helmets 14,100 Sales commissions 10,100 Depreciation on factory building 1,600
Enter each cost item on your answer sheet, placing the dollar amount under the appropriate headings. Total the dollar amounts in each of the columns.
Product Costs
Total Production Cost = Direct Materials + Direct Labor + Manufacturing Overhead ?
= $75,100 + $58,100 + $22,600 = $155,800
Production cost per helmet = $155,800 / 10,000 = $15.58
