Question
The budgeted and actual costs at Goodyear Company is as follows: Budgeted costs Actual costs Materials (per tire): 12 lbs @ $1.80/lb Total materials purchased:
The budgeted and actual costs at Goodyear Company is as follows:
Budgeted costs | Actual costs |
Materials (per tire): 12 lbs @ $1.80/lb | Total materials purchased: 840,000lbs |
Labor (per tire): 4 hrs. @ $14/hr | Total cost of purchase: $1,554,000 |
Factory O/H (per tire): 3 hrs. @ $8/hr | Total material used: 849,600 lbs |
Labor (per tire): 4.1 hrs @ $13/hr | |
Factory O/H (per tire): 2.8 hrs @ $8.50/hr |
During October, Goodyear produced 72,000 tires. |
The budgeted cost and actual cost, respectively, of producing one tire is (to the nearest $)
Please kindly explain how you arrived at your answer step by step so I can understand better. Thank you
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