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Each visor requires a total of $5.00 in direct materials that includes an adjustable closure that the company purchases from a supplier at a
Each visor requires a total of $5.00 in direct materials that includes an adjustable closure that the company purchases from a supplier at a cost of $2.50 each. Shadee wants to have 28 closures on hand on May 1, 22 closures on May 31, and 23 closures on June 30 and variable manufacturing overhead is $1.25 per unit produced. Suppose that each visor takes 0.90 direct labor hours to produce and Shadee pays its workers $9 per hour. Additional information: Selling costs are expected to be 10 percent of sales. Fixed administrative expenses per month total $1,600.
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