Genuine Spice Inc. began operations on January 1 of the current...

Genuine Spice Inc. began operations on January 1 of the current year. The company produces eight-ounce bottles of hand and body lotion calledEternal Beauty. The lotion is sold wholesale in 12-bottle cases for $100 per case. There is a selling commission of $20 per case. The January direct materials, direct labor, and factory overhead costs are as follows:

Direct Materials

Cost Behavior Units Per Case Cost Per Unit Direct Materials Cost

Per Case

Cream Base Variable 100 oz $0.02 $ 2.00

Natural Oils Variable 30 oz .30 9.00

Bottle (8 oz.) Variable 12 bottles .50 6.00

____________

17.00

Direct Labor

Department Cost Behavior Time Per Case Labor Rate Per Hour Direct Labor Cost Per Case

Mixing Variable 20 minutes $18.00 $6.00

Filling Variable 5 $14.40 $1.20

______ _________

25 minutes $7.20

Factory Overhead

Cost Behavior Total Cost

Utilities Mixed $. 600.00

Facility Lease Fixed 14,000.00

Equipment Depreciation Fixed 4,300.00

Supplies Fixed 660.00

_____________

$19,560

PART 1