Q1. An order for 5000 units of Part 491 is received by the Diamonds & Spades Engineering Company. The raw material used for the production of part costs $1.5 per part. The basic manufacturing sequence, with standard operation times per part and machine overhead rates, is given below: Operation Cutting Milling Drilling Grinding Packaging Time per Part 3 min. 5 min. 4 min. 3 min. 0.3 min. Overhead Rate $1.20/hour 2.00/hour 1.70/hour 1.40/hour The direct labor hour per part is equal to the machine time per part (packaging is a manual operation only). The tooling cost for this job order is estimated to be $500. In addition to the tooling costs and machine overhead costs, factory overhead costs are $15 per direct labor hour. The average direct labor hour rate is $10 per hour. a. Assuming zero scrap rate during production, determine the total estimated costs for the job order of 5000 units. b. Determine the unit selling price if profit is to be 25% of the selling price.

Q1. An order for 5000 units of Part 491 is received by the Diamonds & Spades Engineering Company. The raw material used for the production of part costs $1.5 per part. The basic manufacturing sequence, with standard operation times per part and machine overhead rates, is given below: Operation Cutting Milling Drilling Grinding Packaging Time per Part 3 min. 5 min. 4 min. 3 min. 0.3 min. Overhead Rate $1.20/hour 2.00/hour 1.70/hour 1.40/hour The direct labor hour per part is equal to the machine time per part (packaging is a manual operation only). The tooling cost for this job order is estimated to be $500. In addition to the tooling costs and machine overhead costs, factory overhead costs are $15 per direct labor hour. The average direct labor hour rate is $10 per hour. a. Assuming zero scrap rate during production, determine the total estimated costs for the job order of 5000 units. b. Determine the unit selling price if profit is to be 25% of the selling price.

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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