Spa produces two different spa products: Calm and Spring.

The company uses three operations to manufacture the products: mixing, blending, and packaging.

1.	Calculate the conversion cost rates for each department.
2.	Calculate the budgeted cost of goods manufactured for Calm and Spring for the month of May.
3.	Calculate the cost per container for each product for the month of May.

Calm

is produced in powder form in the mixing department, then transferred to the blending department, and finally to packaging.

Spring undergoes no mixing; it is produced in liquid form in the blending department and then transferred to packaging. In the mixing department,

Lilly Spa applies conversion costs based on labor-hours. It takes 3 minutes to mix the ingredients for a container of Calm. In the blending department, conversion costs are applied based on the number of containers and in the packaging department, on the basis of machine-hours. It takes 1.2 minutes of machine time to fill a container, regardless of the product.

	Calm	Spring
Number of containers	12,000	11,000
Direct materials cost	$32,580	$32,670

The budgeted conversion costs for each department for

May are as follows:

Department	Allocation of Conversion Costs	Budgeted Conversion Cost
Mixing	Direct labor-hours	$660
Blending	Number of containers	$28,750
Packaging	Machine-hours	$1,840