Stefani Company has gathered the following information about its product. Direct materials: Each unit of product contains 3.40 pounds of materials. The average waste and spoilage per unit produced under normal conditions is 0.60 pounds. Materials cost $5 per pound, but Stefani always takes the 4.00% cash discount all of its suppliers offer. Freight costs average $0.40 per pound. Direct labor. Each unit requires 1.00 hours of labor. Setup, cleanup, and downtime average 0.20 hours per unit. The average hourly pay rate of Stefani’s employees is $10.00. Payroll taxes and fringe benefits are an additional $3.90 per hour. Manufacturing overhead. Overhead is applied at a rate of $4.50 per direct labor hour. Compute Stefani’s total standard cost per unit. Total standard cost per unit
Stefani Company has gathered the following information about its product.
Direct materials: Each unit of product contains 3.40 pounds of materials. The average waste and spoilage per unit produced under normal conditions is 0.60 pounds. Materials cost $5 per pound, but Stefani always takes the 4.00% cash discount all of its suppliers offer. Freight costs average $0.40 per pound.
Direct labor. Each unit requires 1.00 hours of labor. Setup, cleanup, and downtime average 0.20 hours per unit. The average hourly pay rate of Stefani’s employees is $10.00. Payroll taxes and
Manufacturing overhead. Overhead is applied at a rate of $4.50 per direct labor hour.
Compute Stefani’s total
| Total standard cost per unit |
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