Utensil City produces a range of frying pans. During May, the company's records revealed the following information about production of the frying pans.
Standards:
Direct materials 3 units @ $2.50 per unit
Direct labour 1 hour @ $14.00 per hour
Manufacturing overhead
Variable $5.00 per direct labour hour
Fixed $6.00 per direct labour hour
Compute the standard unit cost for a frying pan.

Question

Quizplus · Accepted Answer

Direct materials: 3 units x $2.50 per unit = $7.50Direct labour: 1 hour x $14.00 per hour = $14.00Variable manufacturing overhead: 1 hour x $5.00 per hour = $5.00Fixed manufacturing overhead: 1 hour x $6.00 per hour = $6.00Standard unit cost = $7.50 + $14.00 + $5.00 + $6.00 = $32.50

Utensil City Produces a Range of Frying Pans