Gatorade manufactures and sells a nutrition drink for children. It wants to develop a standard cost per gallon. The following are required for production of a 100 gallon batch: 15 minutes                         1,960 ounces of lime Cool-Drink at $.12 per ounce                         40 pounds of sugar at $.60 per pound                         63 kiwi fruit at $.50 each                         100 protein tablets at $.90 each                         4,000 ounces of water at $.003 per ounce Gatorade estimates that 2% of the lime Kool-Drink is wasted, 20% of the sugar is lost, and 10% of the kiwis cannot be used. Instructions Compute the standard cost of the ingredients for one gallon of the nutrition drink.

Cornerstones of Cost Management (Cornerstones Series)
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ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
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Chapter11: Strategic Cost Management
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Gatorade manufactures and sells a nutrition drink for children. It wants to develop a standard cost per gallon. The following are required for production of a 100 gallon batch: 15 minutes

                        1,960 ounces of lime Cool-Drink at $.12 per ounce

                        40 pounds of sugar at $.60 per pound

                        63 kiwi fruit at $.50 each

                        100 protein tablets at $.90 each

                        4,000 ounces of water at $.003 per ounce

Gatorade estimates that 2% of the lime Kool-Drink is wasted, 20% of the sugar is lost, and 10% of the kiwis cannot be used.

Instructions

Compute the standard cost of the ingredients for one gallon of the nutrition drink.

 

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