Cigco Co. sells two products, the deluxe model and the standard. The deluxe sells for $40/unit. The standard sells for $20/unit. Sales are projected to be 1,000 units for the deluxe and 3,000 units for the standard. The deluxe model uses 6 oz. of direct material, the standard model uses 4 oz. of direct material. The material costs $.50/oz. The deluxe model takes 1/2 hour of labor to produce, the standard model takes 1/6 hour of labor to produce. The wage rate is $12.00/hour. Total overhead is $32,000, of which $24,000 is fixed. Total selling and

Cigco Co. sells two products, the deluxe model and the standard. The deluxe sells for $40/unit. The standard sells for $20/unit. Sales are projected to be 1,000 units for the deluxe and 3,000 units for the standard. The deluxe model uses 6 oz. of direct material, the standard model uses 4 oz. of direct material. The material costs $.50/oz. The deluxe model takes 1/2 hour of labor to produce, the standard model takes 1/6 hour of labor to produce. The wage rate is $12.00/hour. Total overhead is $32,000, of which $24,000 is fixed. Total selling and

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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