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Tamra Corp. creates one product line. In February 2013, Tamra paid $530,000 in factory overhead costs. Of that amount, $48,000 was for property taxes on the factory and $124,000 was for January's factory utilities for the year 2013. February's factory utility bill arrived on 12th March, 2013, and was only $81,000 because the weather was considerably milder than in January. Tamra Corp. produced 50,000 units of product in both January and February 2013.
a. Evaluate Tamra's actual factory overhead costs for February 2013?
b. Direct labor costs and Actual per-unit direct material for February 2013 were $24.30 and $10.95. Determine actual total product cost for February?
c. Consider that, other than factory utilities, direct labor, all direct material, and overhead costs for Tamra Corp. were the same for January and February 2013. Will product cost for the two months differ? How will such differences be avoided?
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