Question
Bruce Corporation makes four products in a single facility. These products have the following unit product costs: Products A B C D Direct materials $
Bruce Corporation makes four products in a single facility. These products have the following unit product costs:
| Products | ||||||||
| A | B | C | D | |||||
| Direct materials | $ | 13.10 | $ | 9.00 | $ | 9.80 | $ | 9.40 |
| Direct labor | 18.20 | 26.20 | 32.40 | 39.20 | ||||
| Variable manufacturing overhead | 3.10 | 1.50 | 1.40 | 2.00 | ||||
| Fixed manufacturing overhead | 25.30 | 33.60 | 25.40 | 36.00 | ||||
| Unit product cost | $ | 59.70 | $ | 70.30 | $ | 69.00 | $ | 86.60 |
Additional data concerning these products are listed below.
| Products | ||||||||
| A | B | C | D | |||||
| Grinding minutes per unit | 2.60 | 3.20 | 3.10 | 2.20 | ||||
| Selling price per unit | $ | 74.90 | $ | 92.30 | $ | 86.20 | $ | 103.00 |
| Variable selling cost per unit | $ | 1.00 | $ | 0.00 | $ | 2.10 | $ | 0.40 |
| Monthly demand in units | 2,800 | 2,800 | 1,800 | 2,000 | ||||
The grinding machines are potentially the constraint in the production facility. A total of 52,500 minutes are available per month on these machines.
Direct labor is a variable cost in this company.
How many minutes of grinding machine time would be required to satisfy demand for all four products?
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Public Sector Accounting And Budgeting For Non-Specialists
Authors: G. Jan Van Helden, Ron Hodges
1st Edition
1137376988, 9781137376985
