Vintech Company is planning to produce 2,400 units of product in 2011. Each unit

Question

Vintech Company is planning to produce 2,400 units of product in 2011. Each unit requires 4 pounds of materials at $8 per pound and a half hour of labor at $17 per hour. The overhead rate is 80% of direct labor.


Compute the budgeted amounts for 2011 for direct materials to be used, direct labor, and applied overhead.

Direct materials $
Direct labor $
Applied overhead $



Compute the standard cost of one unit of product. (Round intermediate calculations and your answer to 2 decimal places, e.g. 10.50.)

$

Explanation / Answer

Direct materials $----------- 2,400 x 4 x 8 = $ 76,800

Direct labor $ ------------ -2,400 x 1/2 x 17 = $20,400

Applied overhead $-------------$20,400 x 80% = $ 16,320

====================
Direct materials $----------- 4 x 8 = $ 32

Direct labor $ ------------ 1/2 x 17 = $8.4

Applied overhead $-------------$8.4 x 80% = $ 6.72

Standard cost-----------$ 47.12

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