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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Auditing
Authors: Timothy J. Ph.D. Robertson, Jack C.; Louwers
9th Edition
0072906952, 9780072906950
