Product costs are costs incurred and assigned to a cost object. These costs include direct materials, direct labor, and factory/manufacturing overhead. Direct materials and direct labor are costs you can directly trace to the cost object. Factory/manufacturing overhead are indirect costs allocated to a cost object such as electricity for the manufacturing plant, supervisor salary, and high-volume/low-cost consumables.Imagine you just opened a new bakery out of your home. You produce two products (cost objects): Chocolate Cupcakes and Vanilla Cakes.List all of the materials used and cost of each material for 5 dozen cupcakes and 2 cakes – do a bit of research on how much each of the materials would costList the time it would take for you to make 5 dozen cupcakes and 2 cakes AND multiple the total time by your hourly rateList some of your factory/manufacturing overhead and the estimated costs (ex: electricity, gas, etc.)Sum all of your costs. How much will the 5 dozen cupcakes and 2 cakes? How much is your selling price?Your discussion answers will be graded based on the rubric. See the syllabus if you need to refresh your memory on what is required.
