Exercise 8-8
The Flint Company manufactures 1,193 units of a part that could be purchased from an outside supplier for $13 each. Flint’s costs to manufacture each part are as follows:
| Direct materials | $3 | ||
| Direct labor | 3 | ||
| Variable manufacturing overhead | 3 | ||
| Fixed manufacturing overhead | 8 | ||
| Total | $17 |
All fixed overhead is unavoidable and is allocated based on direct labor. The facilities that are used to manufacture the part have no alternative uses.
Please complete both 8-8 and 9-18
