Question
Dawson Toys, Limited, produces a toy called the Maze. The company has recently created a standard cost system to help control costs and has established
Dawson Toys, Limited, produces a toy called the Maze. The company has recently created a standard cost system to help control costs and has established the following standards for the Maze toy:
Direct materials: 8 microns per toy at $0.32 per micron
Direct labor: 1.2 hours per toy at $6.80 per hour
During July, the company produced 5,400 Maze toys. The toy's production data for the month are as follows:
Direct materials: 78,000 microns were purchased at a cost of $0.30 per micron. 24,000 of these microns were still in inventory at the end of the month.
Direct labor: 7,080 direct labor-hours were worked at a cost of $51,684.
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