Lovitz Company is planning to produce 2,000 units of product in 2012. Each unit requires 2.5 kg

Question:

Lovitz Company is planning to produce 2,000 units of product in 2012. Each unit requires 2.5 kg of materials at $5 per kilogram and a half hour of labour at $16 per hour. The overhead rate is 70% of direct labour.
Instructions
(a) Calculate the budgeted amounts for 2012 for direct materials to be used, direct labour, and applied overhead.
(b) Calculate the standard cost of one unit of product.
(c) What are the potential advantages to a of using standard costs?
Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may...