Question

The following costs are some of the costs incurred by Norwood Incorporated to produce and sell 1,000 units of one of their primary products: • Direct materials, $31,500. • Direct labor, $69,000. • Factory building rent, $8,500. • Factory maintenance salaries, $7,200. • Sales commissions, $10,800. • Shipping costs, $2,700. • Factory equipment lubrication supplies, $1,100. • Factory supervisor’s salary, $15,000. • Straight-line depreciation expense on factory equipment, $6,000. • Advertising campaign costs, $3,800. How much are the total fixed costs?

Answer 1

$40,500

Step-by-step explanation:

The computation of the total fixed cost is shown below:

= Factory building rent + Factory maintenance salaries + Factory supervisor’s salary, + depreciation expense + advertising cost

= $8,500 + $7,200 + $15,000 + $6,000 + $3,800

= $40,500

We simply applied the above formula So that the total fixed cost could come and the same is to be considered