Use the information below for Jensen Company to answer the question that follow. Direct materials used $345,000 Direct labor incurred 250,000 Factory overhead incurred 400,000 Operating expenses 175,000 Jensen Company's product costs are a.$825,000 b.$995,000 c.$920,000 d.$770,000

b.$995,000

Explanation:

Jensen Company

Direct materials used $345,000

Direct labor incurred 250,000

Factory overhead incurred 400,000

Product cost $995,000

Therefore Jensen Company's product costs is $995,000

Direct materials used $345,000 + Direct labor incurred 250,000 +Factory overhead incurred 400,000 =$995,000

Jensen Company's product costs are b.$995,000

Explanation:

Product Cost includes all Manufacturing Costs. Non-Manufacturing Costs are treated as expenses during the current period

Calculation of Jensen Company's product costs

Direct materials                       345,000

Direct labor incurred               250,000

Factory overhead incurred     400,000

Total                                          995,000

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