Answer the following questions using the information below:
The SouthAus Company manufactures several different products.Unit costs associated with Product ADE108 are as follows:
$$\begin{array} { l r }
\text { Direct materials } & \$ 40 \
\text { Direct manufacturing labour } & 8 \
\text { Variable manufacturing overhead } & 12 \
\text { Fixed manufacturing overhead } & 23 \
\text { Sales commissions (2\% of sales) } & 6 \
\text { Administrative salaries } & 9 \underline { 9 } \
\quad \text { Total } & \$ 98
\end{array}$$
-What are the period costs per unit associated with Product ADE108?
A)$15
B)$6
C)$27
D)$9

Question

Answer the following questions using the information below:
The SouthAus Company manufactures several different products.Unit costs associated with Product ADE108 are as follows:
 $$\begin{array} { l r } 
\text { Direct materials } & \$ 40 \
\text { Direct manufacturing labour } & 8 \
\text { Variable manufacturing overhead } & 12 \
\text { Fixed manufacturing overhead } & 23 \
\text { Sales commissions (2\% of sales) } & 6 \
\text { Administrative salaries } & 9 \underline { 9 } \
\quad \text { Total } & \$ 98
\end{array}$$
-What are the period costs per unit associated with Product ADE108?
A)$15
B)$6
C)$27
D)$9

Quizplus · Accepted Answer

Period costs are those that are not directly related to the production of a unit of product. In this case, the period costs are administrative salaries and sales commissions. Administrative salaries are fixed costs that are incurred regardless of the level of production. Sales commissions are variable costs that are incurred as a percentage of sales. The total period costs per unit are $9 ($6 + $3).

Answer the Following Questions Using the Information Below: the SouthAus

Answer the Following Questions Using the Information Below:
the SouthAus