The standard cost per batch of 10,000 bottles using the current data (before the company makes any changes) including direct materials, direct labor, and variable manufacturing overhead in the standard cost per unit.
The standard cost per batch of 10,000 bottles using the current data (before the company makes any changes) including direct materials, direct labor, and variable manufacturing overhead in the standard cost per unit.
Solution Summary: The author calculates the standard cost per batch of 10,000 bottles if the company makes the changes to the bottle design and production process.
Definition Definition System of assigning an estimated cost to the product (instead of the actual cost) so that the product cost can be determined well in advance and the pricing of the product can be done on time. Since the actual cost cannot be predicted at the initial stage of the production process, the estimated cost is recorded in the books. Any deviation of the estimated cost of the actual cost is adjusted in the books at the end of the period.
Chapter 11, Problem 11.41BE
1.
To determine
To calculate: The standard cost per batch of 10,000 bottles using the current data (before the company makes any changes) including direct materials, direct labor, and variable manufacturing overhead in the standard cost per unit.
2.
To determine
To calculate: The standard cost per batch of 10,000 bottles if the company makes the changes to the bottle design and production process so that less plastic is used including direct materials, direct labor, and variable manufacturing overhead in the standard cost per unit.
3.
To determine
To calculate: The cost savings per batch by comparing the standard cost per batch under each scenario (current versus proposed change).
To find: The number of batches of bottles which would need to be produced after the change to have the cost savings total equal the cost to make the changes.
4.
To determine
The benefits which might arise from making this change to using less plastic in the manufacture of the bottles.
The actual cost of direct materials is $48.25 per pound, while the standard cost per pound is $50.75. During the current period, 4,800 pounds were used in production. What is the direct materials price variance?
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Chapter 11 Solutions
Managerial Accounting, Student Value Edition Plus MyLab Accounting with Pearson eText -- Access Card Package (5th Edition)
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