Blogs makes one product, the joe. Two types of labour are involved in the preparation of...

 

Transcribed Image Text:

Blogs makes one product, the joe. Two types of labour are involved in the preparation of a joe, skilled and semi-skilled. Skilled labour is paid $10 per hour and semi skilled $5 per hour. Twice as many skilled labour hours as semi-skilled labour hours are needed to produce a joe, four semi- skilled labour hours being needed. A joe is made up of three different direct materials. 7 kg of direct material A, 4 litres of direct material B and 3 metres of direct material C are needed. Direct material A cost $1 per kg, direct material B $2 per litre and direct material C $3 per metre. Variable productions OH are incurred at Bloggs Co at the rate of $2.50 per direct labour (skilled) hour. A system of absorption costing is in operation at Bloggs Co. The basis of absorption is direct labour (skilled) hours. For the forthcoming accounting period, budgeted fixed production OH are $250,000 and budgeted production of the joe is 5,000 units. Administration, selling and distribution OH are added to product at the rate of $10 per unit. A mark-up of 25% is made on the joe. Required: Using the above information draw up a standard cost card for the joe. Blogs makes one product, the joe. Two types of labour are involved in the preparation of a joe, skilled and semi-skilled. Skilled labour is paid $10 per hour and semi skilled $5 per hour. Twice as many skilled labour hours as semi-skilled labour hours are needed to produce a joe, four semi- skilled labour hours being needed. A joe is made up of three different direct materials. 7 kg of direct material A, 4 litres of direct material B and 3 metres of direct material C are needed. Direct material A cost $1 per kg, direct material B $2 per litre and direct material C $3 per metre. Variable productions OH are incurred at Bloggs Co at the rate of $2.50 per direct labour (skilled) hour. A system of absorption costing is in operation at Bloggs Co. The basis of absorption is direct labour (skilled) hours. For the forthcoming accounting period, budgeted fixed production OH are $250,000 and budgeted production of the joe is 5,000 units. Administration, selling and distribution OH are added to product at the rate of $10 per unit. A mark-up of 25% is made on the joe. Required: Using the above information draw up a standard cost card for the joe.

Answer rating: 100% (QA)

Standard Cost Card for Joe Direct Material Direct Material A ... View the full answer