Question
Lakeway Manufacturing Co. manufactures and sells household cleaning products. The company's research department has developed a new cleaner for which a standard cost must be
Lakeway Manufacturing Co. manufactures and sells household cleaning products. The company's research department has developed a new cleaner for which a standard cost must be determined. The new cleaner is made by mixing 10 quarts of triphate solution and 4 pounds of sobase granules and boiling the mixture for several minutes. After the solution has cooled, 4 ounces of methage are added. This "recipe" produces 10 quarts of the cleaner, which is then packaged in 1-quart plastic dispenser bottles. Raw material costs are as follows:
Triphate solution | $ | 0.34 | per quart |
Sobase granules | 0.95 | per pound | |
Methage | 1.16 | per ounce | |
Bottle | 0.11 | each | |
|
a. Using the preceding data, calculate the raw material cost for one bottle of the new cleaner. (Do not round intermediate calculations. Round final answer to 3 decimal places.)
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