The Dorilane Company produces a set of wood patio furniture consisting of a table and four chairs. The company has enough customer demand to justify producing its full capacity of 4,000 sets per year. Annual cost data at full capacity follow: Direct labor Advertising Factory supervision Property taxes, factory building Sales commissions Insurance, factory Depreciation, administrative office equipment Lease cost, factory equipment Indirect materials, factory Depreciation, factory building Administrative office supplies (billing) Administrative office salaries Direct materials used (wood, bolts, etc.). Utilities, factory Cost Item Required: 1. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a product cost. (If the item is a product cost, it should also be classified as either direct or indirect.) 2. Compute the average product cost of one patio set. 3. Assume production drops to only 1,000 sets annually. Would you expect the average product cost per set to increase, decrease, or remain unchanged? Direct labor Advertising Factory supervision Property taxes, factory building Sales commissions Complete this question by entering your answers in the tabs below. Insurance, factory Depreciation, administrative office equipment $ 87,000 $ 105,000 $ 73,000 Required 1 Required 2 Required 3 Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a product cost. (If the item is a product cost, it should also be classified as either direct or indirect.) Show less A Lease cost, factory equipment Indirect materials, factory $ 19,000 $ 59,000 $ 6,000 $1,000 $18,000 Depreciation, factory building Administrative office supplies (biling) Administrative office salaries Direct materials used (wood, balts, etc.) Utilities, factory Total costs $ 16,000 $ 100,000 $5,000 $ 115,000 $ 433,000 $ 45,000 Variable Cost Behavior < Required 1 Fixed Perlod (Selling or Administrative) Cost Required 2 > Product Cost Direct Indirect
The Dorilane Company produces a set of wood patio furniture consisting of a table and four chairs. The company has enough customer demand to justify producing its full capacity of 4,000 sets per year. Annual cost data at full capacity follow: Direct labor Advertising Factory supervision Property taxes, factory building Sales commissions Insurance, factory Depreciation, administrative office equipment Lease cost, factory equipment Indirect materials, factory Depreciation, factory building Administrative office supplies (billing) Administrative office salaries Direct materials used (wood, bolts, etc.). Utilities, factory Cost Item Required: 1. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a product cost. (If the item is a product cost, it should also be classified as either direct or indirect.) 2. Compute the average product cost of one patio set. 3. Assume production drops to only 1,000 sets annually. Would you expect the average product cost per set to increase, decrease, or remain unchanged? Direct labor Advertising Factory supervision Property taxes, factory building Sales commissions Complete this question by entering your answers in the tabs below. Insurance, factory Depreciation, administrative office equipment $ 87,000 $ 105,000 $ 73,000 Required 1 Required 2 Required 3 Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a product cost. (If the item is a product cost, it should also be classified as either direct or indirect.) Show less A Lease cost, factory equipment Indirect materials, factory $ 19,000 $ 59,000 $ 6,000 $1,000 $18,000 Depreciation, factory building Administrative office supplies (biling) Administrative office salaries Direct materials used (wood, balts, etc.) Utilities, factory Total costs $ 16,000 $ 100,000 $5,000 $ 115,000 $ 433,000 $ 45,000 Variable Cost Behavior < Required 1 Fixed Perlod (Selling or Administrative) Cost Required 2 > Product Cost Direct Indirect
Chapter2: Building Blocks Of Managerial Accounting
Section: Chapter Questions
Problem 4EB: Roper Furniture manufactures office furniture and tracks cost data across their process. The...
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Question
![The Dorilane Company produces a set of wood patio furniture consisting of a table and four chairs. The company has enough
customer demand to justify producing its full capacity of 4,000 sets per year. Annual cost data at full capacity follow:
Direct labor
Advertising
Factory supervision
Property taxes, factory building
Sales commissions
Insurance, factory
Depreciation, administrative office equipment
Lease cost, factory equipment
Indirect materials, factory
Depreciation, factory building
Administrative office supplies (billing)
Administrative office salaries
Direct materials used (wood, bolts, etc.)
Utilities, factory
Required:
1. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as
variable or fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a
product cost. (If the item is a product cost, it should also be classified as either direct or indirect.)
2. Compute the average product cost of one patio set.
3. Assume production drops to only 1,000 sets annually. Would you expect the average product cost per set to increase, decrease, or
remain unchanged?
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Required 3
Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or
fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a product cost. (If the item is a
product cost, it should also be classified as either direct or indirect.)
Cost Item
$ 87,000
$ 105,000
$ 73,000
$ 19,000
$ 59,000
$ 6,000
$ 1,000
$ 18,000
$ 16,000
$ 100,000
$ 5,000
Direct labor
Advertising
Factory supervision
Property taxes, factory building
Sales commissions
Insurance, factory
$ 115,000
$ 433,000
$ 45,000
Depreciation, administrative office equipment
Lease cost, factory equipment
Indirect materials, factory
Depreciation, factory building
Administrative office supplies (billing)
Administrative office salaries
Direct materials used (wood, bolts, etc.)
Utilities, factory
Total costs
Variable
Coet Behavior
< Required 1
Fixed
Perlod (Selling
or
Administrative)
Cost
Required 2 >
Product Cost
Direct
Indirect
Show less A](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb16b6c11-26e2-40d2-a820-fcc5d6bdcd13%2F8e63998e-f024-42ff-9420-14172ea04c4b%2Fnots5ii_processed.png&w=3840&q=75)
Transcribed Image Text:The Dorilane Company produces a set of wood patio furniture consisting of a table and four chairs. The company has enough
customer demand to justify producing its full capacity of 4,000 sets per year. Annual cost data at full capacity follow:
Direct labor
Advertising
Factory supervision
Property taxes, factory building
Sales commissions
Insurance, factory
Depreciation, administrative office equipment
Lease cost, factory equipment
Indirect materials, factory
Depreciation, factory building
Administrative office supplies (billing)
Administrative office salaries
Direct materials used (wood, bolts, etc.)
Utilities, factory
Required:
1. Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as
variable or fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a
product cost. (If the item is a product cost, it should also be classified as either direct or indirect.)
2. Compute the average product cost of one patio set.
3. Assume production drops to only 1,000 sets annually. Would you expect the average product cost per set to increase, decrease, or
remain unchanged?
Complete this question by entering your answers in the tabs below.
Required 1
Required 2
Required 3
Enter the dollar amount of each cost item under the appropriate headings. Note that each cost item is classified in two ways: first, as variable or
fixed with respect to the number of units produced and sold; and second, as a selling and administrative cost or a product cost. (If the item is a
product cost, it should also be classified as either direct or indirect.)
Cost Item
$ 87,000
$ 105,000
$ 73,000
$ 19,000
$ 59,000
$ 6,000
$ 1,000
$ 18,000
$ 16,000
$ 100,000
$ 5,000
Direct labor
Advertising
Factory supervision
Property taxes, factory building
Sales commissions
Insurance, factory
$ 115,000
$ 433,000
$ 45,000
Depreciation, administrative office equipment
Lease cost, factory equipment
Indirect materials, factory
Depreciation, factory building
Administrative office supplies (billing)
Administrative office salaries
Direct materials used (wood, bolts, etc.)
Utilities, factory
Total costs
Variable
Coet Behavior
< Required 1
Fixed
Perlod (Selling
or
Administrative)
Cost
Required 2 >
Product Cost
Direct
Indirect
Show less A
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