Question
Hank Itzek manufactures and sells homemade wine, and he wants to develop a standard cost per gallon. The following are required for production of a
Hank Itzek manufactures and sells homemade wine, and he wants to develop a standard cost per gallon. The following are required for production of a 290-gallon batch.
3,000 ounces of grape concentrate at $0.04 per ounce
377 pounds of granulated sugar at $0.48 per pound
435 lemons at $0.78 each
290 yeast tablets at $0.20 each
870 nutrient tablets at $0.16 each
3,000 ounces of water at $0.007 per ounce
Hank estimates that 2% of the grape concentrate is wasted, 10% of the sugar is lost, and 26% of the lemons cannot be used.
Compute the standard cost of the ingredients for one gallon of wine. (Round intermediate calculations and final answer to 2 decimal places, e.g. 1.25.)
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