Question

Exercise 11-3 (Video) Stefani Company has gathered the following information about its product. Direct materials: Each unit of product contains 3.10 pounds of materials. The average waste and spoilage per unit produced under normal conditions is 0.90 pounds. Materials cost $2 per pound, but Stefani always takes the 4.00% cash discount all of its suppliers offer. Freight costs average $0.45 per pound. Direct labor. Each unit requires 1.30 hours of labor. Setup, cleanup, and downtime average 0.20 hours per unit. The average hourly pay rate of Stefani's employees is $12.50. Payroll taxes and fringe benefits are an additional $2.40 per hour. Manufacturing overhead. Overhead is applied at a rate of $7.20 per direct labor hour. Compute Stefani's total standard cost per unit. (Round answer to 2 decimal places, e.g. 1.25.) Total standard cost per unit

Answer 1

calculate standard cost per unit

Direct material (4*2.37)	9.48
Direct labor (1.50*14.90)	22.35
Overhead (1.50*7.20)	10.80
Standard cost per unit	42.63