Problem #1
Listed here are the total costs associated with the production and sales of 50,000 sports water bottles manufactured by Thirst Quenchers Inc for the month March 2013. The water bottles sell for $6 each.
Required
1. Complete the schedule on the answer sheet by entering EACH COST in the amount for the production of 50,000 units as (a) either a product cost (direct materials, direct labor or factory overhead) or a period cost.
2. Compute totals for each column. In other words, you should have a total for direct materials, direct labor and factory overhead for product costs and a total for period costs. Save yourself some time - use the sum function to add column totals.
3. Compute the cost of one water bottle. Think about this. What is included in the cost of making a product?
4. Assume that you sold all bottles produced for $6.00 per bottle. Prepare a basic income statement for the month of March 2013. This is similar in format to the one you made for the excel extra credit assignment.
5. From the income statement you prepare compute the gross profit rate and profit margin for the month of March 2013