Cuevas Company produces magic swords.It uses units as the cost driver for overhead.The following information was provided concerning its standard cost system for 2017: $\begin{array}{|l|l|}
\hline{\text { Standard/Budgeted Data }} \
\hline \text { Material } & \begin{array}{l}
1 / 2 \mathrm{~b} . @ \$ 15.00 \text { per } \
\mathrm{b} .
\end{array} \
\hline \text { Labor } & \begin{array}{l}
1.2 \mathrm{hrs} . @ \$ 12 \mathrm{per} \
\mathrm{hr} .
\end{array} \
\hline \text { Fixed overhead } & \$ 62,000 \
\hline \begin{array}{l}
\text { Variable } \
\text { overhead }
\end{array} & \$ 11 \text { per unit } \
\hline \text { Production } & 2,000 \text { units } \
\hline
\end{array}$ $\begin{array}{|l|l|}
\hline {\text { Actual Data }} \
\hline \text { Produced } & 2,100 \text { units } \
\hline \begin{array}{l}
\text { Materials } \
\text { purchased }
\end{array} & 1,050 \mathrm{lbs} \text {. for } \$ 14,700 \
\hline \text { Materials used } & 1,080 \mathrm{lbs} . \
\hline \text { Laborworked } & \begin{array}{l}
2,500 \mathrm{hrs} . \text { costing } \
\$ 29,375
\end{array} \\
\hline \text { Overhead } & \$ 82,000 \
\hline
\end{array}$ How much is the standard cost per unit?

Question

Quizplus · Accepted Answer

The standard cost per unit is calculated by adding the standard costs of material, labor, and overhead. Material cost per unit = 0.5 lbs @ $15.00 = $7.50. Labor cost per unit = 1.2 hrs @ $12.00 = $14.40. Overhead cost per unit = Fixed overhead ($62,000) / 2,000 units + Variable overhead ($11 per unit) = $31 + $11 = $42. Total standard cost per unit = $7.50 (material) + $14.40 (labor) + $42.00 (overhead) = $63.90.

Cuevas Company Produces Magic Swords How Much Is the Standard Cost Per Unit? A)$21

Cuevas Company Produces Magic Swords How Much Is the Standard Cost Per Unit?
A)$21