Massachusetts Office Products (MOP) produces three different papei products at its Vaasa lumber plant Supreme, Deluxe, and Regular Each product has its own dedicated production (the at the plant: MOP currently uses the following three-part classification for its manufacturing costs direct materials, direct manufacturing labor, and manufacturing overhead costs. Total manufacturing overhead costs of the plant in July 2013 are $190 million ($25 million of which are fixed). This total amount is allocated to each product line on the basis of the direct manufacturing labor costs of each line Summary data (in millions) for July 2013 are (Click the icon to view the data) Requirements Compute the manufacturing cost per unit for each product produced in July 2013 Suppose that in August 2013. production was 90 million units of Supreme, 140 million units of Deluxe, and 160 million units of Regular. Why might the July 2013 information on manufacturing cost per unit be misleading when predicting total manufacturing costs in August 2013? Requirement 1. Compute the manufactunng cost per unit for each product produced in July 2013. Begin by determining the formula needed to calculate the total manufactunng cost per unit. / = Total manufacturing cost per unit Solution Solution - The Question seems to incomplete - We need to add all the Cost Direct Material , Direct Labor & Manufacturing Overheads and divide it by the number of units to arrive at the Manufacturing Cost per unit - If the data has Per unit cost of Direct Material , Direct Labor & Manufacturing Overheads we need to multiply all of them separately with the number of units and add them together and divide by number of units to get Cost per unit Please Note - As the Total Manufacturing Overheads ( Contains Fixed as well as variable cost ) ensure with change in Quantity the variable cost should be changed and the fixed cost to be kept Static .

1. Massachusetts Office Products (MOP) produces three different papei products at its Vaasa
lumber plant Supreme, Deluxe, and Regular Each product has its own dedicated production (the
at the plant: MOP currently uses the following three-part classification for its manufacturing
costs direct materials, direct manufacturing labor, and manufacturing overhead costs. Total
manufacturing overhead costs of the plant in July 2013 are $190 million ($25 million of which
are fixed). This total amount is allocated to each product line on the basis of the direct
manufacturing labor costs of each line Summary data (in millions) for July 2013 are (Click the
icon to view the data) Requirements Compute the manufacturing cost per unit for each product
produced in July 2013 Suppose that in August 2013. production was 90 million units of
Supreme, 140 million units of Deluxe, and 160 million units of Regular. Why might the July
2013 information on manufacturing cost per unit be misleading when predicting total
manufacturing costs in August 2013? Requirement 1. Compute the manufactunng cost per unit
for each product produced in July 2013. Begin by determining the formula needed to calculate
the total manufactunng cost per unit. / = Total manufacturing cost per unit
Solution
Solution - The Question seems to incomplete - We need to add all the Cost Direct Material ,
Direct Labor & Manufacturing Overheads and divide it by the number of units to arrive at the
Manufacturing Cost per unit - If the data has Per unit cost of Direct Material , Direct Labor &
Manufacturing Overheads we need to multiply all of them separately with the number of units
and add them together and divide by number of units to get Cost per unit
Please Note - As the Total Manufacturing Overheads ( Contains Fixed as well as variable cost )
ensure with change in Quantity the variable cost should be changed and the fixed cost to be kept
Static