50.1K

Verified Solution

Link Copied!

Need help with this homework problem involving product cost estimate:

Total overhead is 116,750

1.Prepare a complete product cost estimate for Buffalo Ale, Bismark Bock and Four Heads Stout (See Exhibit 4) using: a. the plant-wide allocation based on direct-labor hours; b. an activity-based cost system.

Exhibit 4. Direct Cost Analysis for a Single Batch of each Beer Label

Buffalo Ale (Expected Yield = 22 cases)
Direct Materials:
Coopers Amber Malt	50 kgs	@	$0.60	$30.00
Northumberland Malt	50 kgs	@	0.30	15.00
Corn sugar	5 kgs	@	0.25	1.25
Geleany hops	1.75 kgs	@	1.00	1.75
Filtered water	220 ltrs	@	0.03	6.60
Brewers yeast	100 gms	@	0.08	8.00
Total DM Cost				$62.60
Direct Labor	18 hrs	@	$6.00	108.00
Overhead Costs				?
Total Product Cost per Batch				?
Cost per bottle				?

Bismark Bock (Expected Yield = 16 cases)
Direct Materials:
John Bull Dark Malt	55 kgs	@	$1.08	$59.25
Newquay Brown Malt	20 kgs	@	0.75	15.00
Perle hops	2.87 kgs	@	1.50	4.30
Filtered water	160 ltrs	@	0.03	4.80
Brewers yeast	70 gms	@	0.08	5.60
Total DM Cost				$88.95
Direct Labor	12 hrs	@	$6.00	72.00
Overhead Costs				?
Total Product Cost per Batch				?
Cost per bottle				?

Four Heads Stout (Expected Yield = 18 cases)
Direct Materials:
Irish Stout Malt	40 kgs	@	$1.02	$40.80
Strong Export Bitter Malt	14 kgs	@	2.40	33.66
East Kent Goldings hops	1.32 kgs	@	2.80	3.69
Filtered water	180 ltrs	@	0.03	5.40
Brewers yeast	75 gms	@	0.08	6.00
Total DM Cost				$89.55
Direct Labor	13 hrs	@	$6.00	78.00
Overhead Costs				?
Total Product Cost per Batch				?
Cost per bottle				?

Answer & Explanation Solved by verified expert

See Answer