Carter Furniture Manufactures Three Models of Tables: Oak, Cherry, and Walnut

question 127

Essay

Carter Furniture manufactures three models of tables: oak, cherry, and walnut. All models are assembled in the same plant and require the same assembling operations. The difference is in the cost of the wood. The following data are available for July.
$\begin{array}{llr}&\text { Oak } & \text { Cherry}& \text { Walnut } & \text { Total }\\ \text { Number of units } &1,200&700&900&2,800\\ \text { Wood costs per unit } &\$80&\$120&\$105\\ \text { Other costs: } &\\ \text {Direct labor } &&&&\$165,000\\ \text {Indirect materials } &&&&26,000\\ \text { Other overhead } &&&&61,000\\ \text { Total} &&&&\$252,000\\\end{array}$

Carter uses operations costing and assigns conversion costs on the number of tables built.
Required:
Compute the cost of the each of the three models for July.

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Definitions:

Auction With Reserve

An auction where the seller retains the right to accept or reject the highest bid within a specific time frame, due to a minimum sale price not being met.

Mutual Assent

An agreement between parties that is reached when all involved parties have a matching understanding and intention to be bound by the terms.

Agreement Standard

The established criteria or clauses that form the basis of a contractual agreement between parties.

Acceptance

In contract law, it is the act of agreeing to the terms of an offer, thus creating a binding contract.