Question
B enguet Inc. produces two brands of coffee: Star and Sun. These are produced in one factory Using the same process except for the cost
Benguet Inc. produces two brands of coffee: Star and Sun. These are produced in one factory
Using the same process except for the cost of the direct materials, roasted beans, which is P40 per pound for Star and P60 for Sun. The following data are given for the month of March 2021:
Star | Sun | Total | |
Number of pounds produced | 5,000 | 3,000 | 8,000 |
Direct Labor | P250,000 | ||
Indirect Materials | 30,000 | ||
Other Overhead | 50,000 |
Benguet uses operation costing and assigns conversion costs based on the number of pounds
produced for each brand. Compute the unit cost of each brand produced in March. Regular selling price of each is P1,000 per packfor Star and P1,200 per pack for Sun. A pack weighs 10 pounds. A GPR of 15 % is considered adequate. Is it still adequate for each brand?
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