Do not give image format Required InformationExercise 14-16 (Algo) Developing raw material cost standards LO 8, 9[The following information applies to the questions displayed below.]Lakeway Manufacturing Co. manufactures and sells household cleaning products. The company'sresearch department has developed a new cleaner for which a standard cost must bedetermined. The new cleaner is made by mixing 12 quarts of triphate solution and 2 pounds ofsobase granules and boiling the mixture for several minutes. After the solution has cooled, 3ounces of methage are added. This "recipe" produces 14 quarts of the cleaner, which is thenpackaged in 1-quart plastic dispenser bottles. Raw material costs are as follows:Triphate solutionSobase granulesMethageBottle$0.34 per quart0.89 per pound1.20 per ounce0.24 eachExercise 14-16 (Algo) Part bb. Assume that the preceding costs are the current best estimates of the costs at which required quantities of theraw material can be purchased. What other factors would you recommend to be considered in establishing the rawmaterial cost standard for the new cleaner? (You may select more than one answer. Single click the box with thequestion mark to produce a check mark for a correct answer and double click the box with the question mark toempty the box for a wrong answer. Any boxes left with a question mark will be automatically graded asincorrect.)Decrease in selling price.Possible cost increases during coming year.Spillage / spollage/waste in the manufacturing process.Change in the labor cost. !Required InformationExercise 14-16 (Algo) Developing raw material cost standards LO 8, 9[The following information applies to the questions displayed below.]Lakeway Manufacturing Co. manufactures and sells household cleaning products. The company'sresearch department has developed a new cleaner for which a standard cost must bedetermined. The new cleaner is made by mixing 12 quarts of triphate solution and 2 pounds ofsobase granules and boiling the mixture for several minutes. After the solution has cooled, 3ounces of methage are added. This "recipe" produces 14 quarts of the cleaner, which is thenpackaged in 1-quart plastic dispenser bottles. Raw material costs are as follows:Triphate solutionSobase granulesMethageBottle$0.34 per quart0.89 per pound1.20 per ounce0.24 eachExercise 14-16 (Algo) Part aRequired:a. Using the preceding data, calculate the raw material cost for one bottle of the new cleaner. (Do not roundIntermediate calculations. Round final answer to 3 decimal places.)Cost per bottle

The standard costs are set by management based on their past experience of production, available…

Required Information Exercise 14-16 (Algo) Developing raw material cost standards LO 8, 9 [The following information applies to the questions displayed below.] Lakeway Manufacturing Co. manufactures and sells household cleaning products. The company's research department has developed a new cleaner for which a standard cost must be determined. The new cleaner is made by mixing 12 quarts of triphate solution and 2 pounds of sobase granules and boiling the mixture for several minutes. After the solution has cooled, 3 ounces of methage are added. This "recipe" produces 14 quarts of the cleaner, which is then packaged in 1-quart plastic dispenser bottles. Raw material costs are as follows: Triphate solution Sobase granules Methage Bottle $0.34 per quart 0.89 per pound 1.20 per ounce 0.24 each Exercise 14-16 (Algo) Part a Required: a. Using the preceding data, calculate the raw material cost for one bottle of the new cleaner. (Do not round Intermediate calculations. Round final answer to 3 decimal places.) Cost per bottle

Required Information Exercise 14-16 (Algo) Developing raw material cost standards LO 8, 9 [The following information applies to the questions displayed below.] Lakeway Manufacturing Co. manufactures and sells household cleaning products. The company's research department has developed a new cleaner for which a standard cost must be determined. The new cleaner is made by mixing 12 quarts of triphate solution and 2 pounds of sobase granules and boiling the mixture for several minutes. After the solution has cooled, 3 ounces of methage are added. This "recipe" produces 14 quarts of the cleaner, which is then packaged in 1-quart plastic dispenser bottles. Raw material costs are as follows: Triphate solution Sobase granules Methage Bottle $0.34 per quart 0.89 per pound 1.20 per ounce 0.24 each Exercise 14-16 (Algo) Part a Required: a. Using the preceding data, calculate the raw material cost for one bottle of the new cleaner. (Do not round Intermediate calculations. Round final answer to 3 decimal places.) Cost per bottle

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter2: Accounting For Materials

Section: Chapter Questions

Problem 18E: For E2-17, prepare any journal entries that would have been different if the only trigger points had...

See similar textbooks

Similar questions

The controller of Ferrence Company estimates the amount of materials handling overhead cost that should be allocated to the company's two products using the data that are given below: The total materials handling cost for the year is expected to be $16,486.40. If the materials handling cost is allocated on the basis of material moves, how much of the total materials handling cost should be allocated to the specialty windows? (Round off your answer to the nearest whole dollar.) Question 12 options: $3,266 $9,274 $8,243 $6,595
22. SONA Co. received an order for 1,000 units of item AY-14. Because of the order’s exacting specifications, it is anticipated that defective and spoiled work will exceed the normal rate. The materials cost per unit is P140; labor cost, P200; and factory overhead for this order is to be applied at 80% of the labor cost. During production, 150 units were found to be defective and required the following total additional costs; materials, P3,000, labor, P7,500 and factory overhead at 80% of direct labor cost. On final inspection, 50 units were classified as seconds and sold for P200 each, the proceeds being credited to the order. The customer has agreed to accept the good units.How much is the unit cost of the finished products?
Question 15 The assembly division of Quality Time Pieces, Inc. uses the FIFO method of process costing. Consider the following data for May 2020: Physical units Direct Materials Conversion Costs Beginning WIP 100 $459,888 $142,570 Started in May 2020 510 Completed during May 2020 450 Total costs added during May 2020 $3,237,000 $1,916,000 Degree of completion: Beginning WIP: direct materials 80%; conversion costs 35% Degree of completion: Ending WIP: direct materials 80%; conversion costs 40% What would be the cost of units completed and transferred out using FIFO method? Group of answer choices $4,065,000 $4,667,140 $1,088,000 $4,207,570
Huron Company produces a commercial cleaning compound known as Zoom. The direct materials and direct labor standards for one unit of Zoom are given below: Standard quantity or hours of direct materials: 7.40 pounds, standard price or rate of direct materials is 2.60 per pound. Standard cost of direct materials is 19.24. Standard quality or hours of direct labor is 0.45. Standard price or rate of direct labor is 8.00 per pound. Standard cost is 3.60. During the most recent month, the following activity was recorded: 12,100 pounds of material were purchased at a cost of 2.50 per pound. All of the material purchased was used to produce 1,500 units of the product. 575 hours of direct labor time were recorded at a total labor cost of 5,750. Compute the materials price variance and the materials quantity variance for the month. Complete the labor rate variance and efficiency variance for the month.
Alto Company currently produces component TH1 for one of its products. The current cost per unit to manufacture its required 400,000 units of TH1 follows. Direct materials and direct labor are 100% variable. Overhead is 75% fixed. An outside supplier has offered to supply the 400,000 units of TH1 for $4 per unit. Required 1. Determine whether management should make or buy the TH1. Analysis Component 2. What factors besides cost must management consider when deciding whether to make or buy TH1? Direct materials . $1.20 Direct labor . 1.50 Overhead . 6.00 Total cost per unit . $8.70
Anderson Plastics makes plastic rear lamps for cars. Spoiled units are detected upon inspection at the end of the process and are disposed of at zero net disposal price. Assume normal spoilage is 10% of the good output produced. The following information about actual conversion costs for April is available: Actual units Equivalent units Total costs Work in progress, April 1 15,000 14,000 €145,600 Work done during April 29,000 28,000 308,000 To account for 44,000 42,000 €453,600 Good units completed and transferred 20,000 20,000 ? out during April Normal and abnormal spoilage 4,000 4,000 ? Work in progress, April 30 20,000 18,000 ? 7.Assume that Anderson uses the weighted-average method. What is the cost of normal spoilage for conversion costs for the month of April? a) €21,600 b) €22,000 c) €43,200 d) €44,000 8.Assume that Anderson uses the FIFO method. What is the cost of abnormal spoilage for conversion costs for the month of April? a) €21,600 b) €22,000 c) €43,200 d)…
A company has received a special order from a customer to make 5,000 units of acustomized product. The direct materials cost per unit of the customized product is$15, the direct labor cost per unit is $5, and the manufacturing overhead per unit is$18, including $6 of variable manufacturing overhead. If the company has sufficientavailable manufacturing capacity, what is the minimum price that can be accepted forthe special order?a. $24 c. $32b. $26 d. $38
Activity-Based Environmental Cost Assignments Pinter Company had the following environmental activities and product information: 1. Environmental activity costs Activity Costs Design products (to reduce pollution) $ 129,600 Test for contamination 230,400 Treat toxic waste 720,000 Operate pollution control equipment 576,000 2. Driver data Solvent X Solvent Y Design hours 2,900 1,900 Testing hours 5,100 7,700 Pounds of waste 600 15,400 Machine hours 2,900 61,100 3. Other production data Solvent X Solvent Y Nonenvironmental production costs $2,176,000 $4,128,000 Units produced 320,000 320,000 What if the design costs increased to $219,600 and the cost of toxic waste decreased to $360,000? Assume that Solvent Y uses 3,800 out of 7,600 design hours. Also assume that waste is cut by 50 percent and that Solvent Y is responsible for…
Activity-Based Environmental Cost Assignments Pinter Company had the following environmental activities and product information: 1. Environmental activity costs Activity Costs Design products (to reduce pollution) $ 129,600 Test for contamination 230,400 Treat toxic waste 720,000 Operate pollution control equipment 576,000 2. Driver data Solvent X Solvent Y Design hours 2,900 1,900 Testing hours 5,100 7,700 Pounds of waste 600 15,400 Machine hours 2,900 61,100 3. Other production data Solvent X Solvent Y Nonenvironmental production costs $2,176,000 $4,128,000 Units produced 320,000 320,000 4. Activity rates that will be used to assign environmental costs to products. Design Produts 27 per design hour Testing 18 per test hour Treating waste 45 per pound of waste Operating equipment 9 per machine hour 1. Determine the unit…
Rev ABC Company uses a standard costing system in connection with the manufacture of their product "X". Each unit of finished product contains 2 yards of a direct material. However, a 20% direct material spoilage calculated on input quantities occurs during the manufacturing process. The standard cost of the direct material is P3 per yard. For the month, the company purchased 100,000 yards of the direct material for P350,000 and used 90,000 yards to produce 40,000 units of Material X. 15 Compute for the Efficiency Variance Topic: Standard Costing and Variance Analysis
Rev ABC Company uses a standard costing system in connection with the manufacture of their product "X". Each unit of finished product contains 2 yards of a direct material. However, a 20% direct material spoilage calculated on input quantities occurs during the manufacturing process. The standard cost of the direct material is P3 per yard. For the month, the company purchased 100,000 yards of the direct material for P350,000 and used 90,000 yards to produce 40,000 units of Material X. 15 Compute for the Price Variance Topic: Standard Costing and Variance Analysis
Lloyd Industries manufactures electrical equipment from specifications received from customers. Job X10 was for 1,000 motors to be used in a specially designed electrical complex. The followingcosts were determined for each motor: At final inspection, Lloyd discovered that 33 motors did not meet the exacting specifications established by the customer. Anexamination indicated that 18 motors were beyond repair andshould be sold as spoiled goods for 75 each. The remaining15 motors, though defective, could be reconditioned as first-qualityunits by the addition of 1,650 for materials, 1,500 for labor, and1,200 for factory overhead. Required: Prepare the journal entries to record the following: 1. The scrapping of the 18 motors, with the income from spoiledgoods treated as a reduction in the manufacturing cost of thespecific job. 2. The correction of the 15 defective motors, with the additionalcost charged to the specific job. 3. The additional cost of replacing the 18 spoiled motors with newmotors. 4. The sale of the spoiled motors for 75 each. 5. If the reconditioned motors sell for 400 each, is Lloyd betteroff reconditioning the defective motors or selling them as isfor 75 as spoiled goods?