The Frosty Company makes mugs for which the following standards have been developed: $$\begin{array} { l l l }
& \text { Standard Inputs } & \text { Standard Price } \
& \text { Expected for E ach } & \text { Expected per } \
& \text { Unit of Output } & \text { Unit of Output } \
\text { Direct materials } & 6 \text { ounces } & \$ 2 \text { per ounce } \
\text { Direct labor } & 3.2 \text { hours } & \$ 9 \text { per hour }
\end{array}$$ Production of 400 mugs was expected in July, but 440 mugs were actually completed. Direct materials purchased and used were 2,100 ounces at an actual price of $2.20 per ounce. Direct labor cost for the month was $5,310, and the actual pay per hour was $10.00. is the standard direct- material cost for each mug produced.
A) $12.00
B) $32.00
C) $9.00
D) $13.20

Question

The Frosty Company makes mugs for which the following standards have been developed: $$\begin{array} { l l l } 
& \text { Standard Inputs } & \text { Standard Price } \
& \text { Expected for E ach } & \text { Expected per } \
& \text { Unit of Output } & \text { Unit of Output } \
\text { Direct materials } & 6 \text { ounces } & \$ 2 \text { per ounce } \
\text { Direct labor } & 3.2 \text { hours } & \$ 9 \text { per hour }
\end{array}$$ Production of 400 mugs was expected in July, but 440 mugs were actually completed. Direct materials purchased and used were 2,100 ounces at an actual price of $2.20 per ounce. Direct labor cost for the month was $5,310, and the actual pay per hour was $10.00. is the standard direct- material cost for each mug produced.
A) $12.00
B) $32.00
C) $9.00
D) $13.20

Quizplus · Accepted Answer

The standard direct-material cost for each mug is calculated by multiplying the standard input (6 ounces) by the standard price per ounce ($2), which equals $12.00.

The Frosty Company Makes Mugs for Which the Following Standards