ABD Company manufactures wooden rocking chairs. ABD identified the following three material costs in its production process for July: PhP5,000,000 for springs for the rocking mechanism; two springs at a cost of PhP500 each are used in each chair; PhP85,000 for glue used as needed from one-gallon containers; and PhP25,000 for stain used to touch up spots on the chairs. How much is the total cost that should have been assigned to indirect materials for July? Show the solution.

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Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.