Calculate
Bent Tree Coffee purchases green coffee beans from various suppliers and then roasts the coffee beans in its roasting facility. The roasted beans are sold in 20-pound cases to grocery stores and restaurants for $75 per case. Each case of roasted coffee beans requires 20 pounds of unroasted green coffee beans. The company can purchase the green coffee beans, including freight-in and purchase discounts, for $2.00 per pound. Each case of roasted coffee beans requires 0.10 hours of direct labor in the production process. Direct laborers are paid $23 per hour, which includes payroll taxes and employee benefits. The company uses machine hours to allocate its manufacturing
Requirements
- 1. What is the standard cost of producing one 20-pound case of roasted coffee beans?
- 2. What is the standard gross profit per 20-pound case of roasted coffee beans?
- 3. How often should the company reassess standard quantities and standard prices for inputs?
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Managerial Accounting (5th Edition)
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