Romy Schneider manufactures and sells homemade wine, and he wants to develop a standard cost per gallon.

Question:

Romy Schneider manufactures and sells homemade wine, and he wants to develop a standard cost per gallon. The following are required for production of a 50-gallon batch.

3,000 ounces of grape concentrate at $0.04 per ounce

54 pounds of granulated sugar at $0.35 per pound

60 lemons at $0.60 each

50 yeast tablets at $0.25 each

50 nutrient tablets at $0.20 each

2,500 ounces of water at $0.004 per ounce

Romy estimates that 4% of the grape concentrate is wasted, 10% of the sugar is lost, and 20% of the lemons cannot be used.

Instructions

Compute the standard cost of the ingredients for one gallon of wine. (Carry computations to two decimal places.)


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Accounting Principles

ISBN: 978-0470534793

10th Edition

Authors: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso

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