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The following data are given for product DRIM69
Budgeted output for the year: 9800 units
Standard details for one unit:
Direct materials: 40 square metres at K5.30 per square metre
Direct wages:
Bonding department 48 hours at K12.50 per hour
Finishing department 30 hours at K7.60 per hour
Budgeted costs and hours per annum:
Variable overhead: (K) (hours)
Bonding department 375000 500000
Finishing department 150000 300000
Fixed overhead: (K)
Production 392000
Selling and distribution 196000
Required:
A. Prepare a standard cost sheet for one unit and enter on the standard cost sheet the costs to show sub-totals for:
(a) prime cost [4 Marks]
(b) variable production cost [4 Marks]
(c) total production cost [4 Marks]
(d) total cost [4 Marks]
B. Calculate the selling price per unit allowing for a profit of 15 per cent of the selling price. [5 Marks]
C. Calculate the amount of the profit per unit. [4 Marks]
Answer & Explanation
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