Session 19 Solutions - Example(Similar to Problem 7-41 Aunt...

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Example: (Similar to Problem 7-41)Aunt Molly’s Old Fashioned Cookies bakes cookies for retail stores. The company’s best selling cookie is marketed as a gourmet cookie and regularly sells for $8 per pound. The standard cost per pound, based on normal monthly production of 400,000 pounds is given below:SI×SP ($/lb)SP ($/unit of input)SI (units of input/lb)0.840.6018.00/hr.2 min.Baking$0.2414.40/hr.1 min.MixingDirect manufacturing labor1.450.500.50/oz.1oz.Almonds0.750.15/oz.5oz.Milk chocolate$0.20$0.02/oz.10oz.Cookie mixDirect materialsTotal Standard CostStandardUnit CostsQuantityCost Item
18.00 / hr14.40 / hr.50 / oz.20 / oz.02 / ozAPActual Cost/unitInput Usage Report, May, 2009AO×AI×APAO×AI240,000800,000 minBaking108,000450,000 minMixingDirect manufacturing labor240,000480,000 oz.Almonds532,0002,660,000 oz.Milk chocolate$93,0004,650,000 oz.Cookie mixDirect materialsActual CostsQuantityCost ItemPerformance Report, May, 2009:50,000 F400,000450,000Units (in pounds)VarianceBudgetActual

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