Question 1 Open Show Work Question 1 Stefani Company has gathered the following

Question

Question 1

Open Show Work

Question 1

Stefani Company has gathered the following information about its product.

Direct materials: Each unit of product contains 3.10 pounds of materials. The average waste and spoilage per unit produced under normal conditions is 0.70 pounds. Materials cost $5 per pound, but Stefani always takes the 5.00% cash discount all of its suppliers offer. Freight costs average $0.45 per pound.

Direct labor. Each unit requires 2.40 hours of labor. Setup, cleanup, and downtime average 0.10 hours per unit. The average hourly pay rate of Stefani’s employees is $14.00. Payroll taxes and fringe benefits are an additional $3.70 per hour.

Manufacturing overhead. Overhead is applied at a rate of $7.00 per direct labor hour.

Compute Stefani’s total standard cost per unit. (Round answer to 2 decimal places, e.g. 1.25.)
Total standard cost per unit $

Click if you would like to Show Work for this question:

Open Show Work

Explanation / Answer

CALCULATION OF STANDARD COST PER UNIT Amount Amount Material Cost $                19.00 (3.10 + 0.70) X $ 5 Less: Cash Discount 5% = $                  0.95 Net Material Cost $                18.05 Add: Freight Cost $                  1.71 (0.45 * 3.8 PoundS) Total Material Cost (A) $                     19.76 Labour Cost Labour Cost = $                35.00 (2.40 Hrs + 0.10 Hrs) X $ 14 Payroll Taxes and others $                  9.25 (2.50 Hrs X $ 3.70) Total Labour Cost (B) $                     44.25 Overhead Cost (C') 17.5 ($ 7 X 2.5 Hrs) Total (A+B+C) $                     64.01

Related Questions

Navigate

• Browse (All)
• Browse Q
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.