The following information is available for product KIT05.
Direct material costs - $52.00 per unit of product
Costs of machining - $23.50 per machine hour
Costs of packing - $8.50 per carton packed
What is the total full cost of an order for 6000 units of product KIT05 which will use 92 machine hours and 64 cartons?
A) $312 000
B) $2 474 000
C) $3 018 000
D) $856 000

Question

Quizplus · Accepted Answer

To calculate the total full cost of an order for 6000 units of product KIT05, we need to add up the costs of direct materials, machining, and packing for all 6000 units.

Direct material costs:

$52.00 per unit x 6000 units = $312,000

Costs of machining:

$23.50 per machine hour x 92 hours = $2,162

Costs of packing:

$8.50 per carton x 64 cartons = $544

Total full cost:

$312,000 + $2,162 + $544 = $314,706

Therefore, the closest option is C: $3,018,000.

The Following Information Is Available for Product KIT05