Topic 2B: Standard Costing: Tutorial Question 1 Ace Ltd makes a product called the 'Bernie'. A unit of Bernie is made using of three types of materials as follows: 8kgs of direct material A, 5 litres of direct material B and 4 meters of direct material c. The cost per unit of direct material for A, B and C is $2, $3 and $4 respectively. Two types of labour are involved in the production of a Bernie, skilled and semi-skilled. Skilled labour is paid $10 per hour and semi-skilled labor is $6 per hour. Thrice as many skilled labor hours as semi-skilled labor hours are needed to produce a unit of Bernie; three semi-skilled labor hours being needed. Variable production overheads are incurred at Ace Ltd at the rate of $3.00 per skilled direct labor hour. A system of absorption costing is in operation at Ace Ltd. The basis of absorption is direct labor (skilled) hours. The budgeted fixed production overheads are $270,000 and the budgeted production of the Bernie is 6,000 units. Administration, selling and distribution overheads (non-production overheads) are added to products at the rate of $13.00 per unit. A mark-up of 25% is made on the Bernie. Required: Draw up a standard cost card for the product 'Bernie