Martin Company received an order for 25 automatic mixing machines. Because ofthe order's exacting specifications, it is anticipated that defective and spoiled work willexceed the normal rate. The materials cost per unit is P80; labor cost, P194; andmanufacturing overhead for this order is to be applied at 100% of the labor cost.During production, 5 units were found to be defective and required the following totaladditional costs: materials, P97, labor, P125, and manufacturing overhead at the 100%rate. On final inspection, 2 units were classified as seconds and sold for P400 each,the proceeds being credited to the order. The purchaser has agreed to accept the 23machines, although the acceptable units are fewer than the number ordered. What isthe unit cost of the completed units?
Martin Company received an order for 25 automatic mixing machines. Because ofthe order's exacting specifications, it is anticipated that defective and spoiled work willexceed the normal rate. The materials cost per unit is P80; labor cost, P194; andmanufacturing overhead for this order is to be applied at 100% of the labor cost.During production, 5 units were found to be defective and required the following totaladditional costs: materials, P97, labor, P125, and manufacturing overhead at the 100%rate. On final inspection, 2 units were classified as seconds and sold for P400 each,the proceeds being credited to the order. The purchaser has agreed to accept the 23machines, although the acceptable units are fewer than the number ordered. What isthe unit cost of the completed units?
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