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Big Thumbs Company manufactures portable flash drives for computers. Big Thumbs incurs monthly depreciation costs of $15,100 on its plant equipment.
Big Thumbs Company manufactures portable flash drives for computers. Big Thumbs incurs monthly depreciation costs of $15,100 on its plant equipment. Also, each drive requires materials and manufacturing overhead resources. On average, the company uses 12,000 ounces of materials to manufacture 4,800 flash drives per month. Each ounce of material costs $3.00. In addition, manufacturing overhead resources are driven by machine hours. On average, the company incurs $33,600 of manufacturing overhead resources to produce 4,800 flash drives per month.
Solution:1) Total cost of flash drives = Fixed cost + (Varible cost per unit*Total no. of units)Total cost of flash drives = 15,100+(7+7.5)*4800Total cost of flash drives = $84,700Note:...