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We know the following for Train Company: Direct Materials: $400,000 Rent on Corporate Sales Office: $10,000 Direct Labor: $250,000 $100,000 Indirect Materials: $25,000 Depreciation on Factory Equipment Rent on Factory: Commissions for Selling Team: $50,000 $45,000

We know the following for Train Company: Direct Materials: $400,000 Rent on Corporate Sales Office: $10,000 Direct Labor: $250,000 $100,000 Indirect Materials: $25,000 Depreciation on Factory Equipment Rent on Factory: Commissions for Selling Team: $50,000 $45,000

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Calculate the product costs.
We know the following for Train Company: Direct Materials: $400,000 Rent on Corporate Sales Office: $10,000 Direct Labor: $250,000 $100,000 Indirect Materials: Depreciation on Factory Equipment Rent on Factory: Commissions for Selling Team: $25,000 $50,000 $45,000
Transcribed Image Text:We know the following for Train Company: Direct Materials: $400,000 Rent on Corporate Sales Office: $10,000 Direct Labor: $250,000 $100,000 Indirect Materials: Depreciation on Factory Equipment Rent on Factory: Commissions for Selling Team: $25,000 $50,000 $45,000
Expert Solution
Step 1

Solution:-

Calculation of the  product costs as follows:-

Introduction:-

Product costs include All direct material, direct labor, and manufacturing overhead relating to products but non- manufacturing costs are treated as period costs.

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