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14.18 Standard absorption cost per unit A cost analyst for Stamper Manufacturing Co. 9. 10...

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Accounting

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14.18 Standard absorption cost per unit A cost analyst for Stamper Manufacturing Co. 9. 10 has assembled the following data about the Model 24 stamp pad: The piece of sheet metal from which eight pad cases can be made costs $0.18. This amount is based on the number of sheets in a 4.000-pound bundle of sheet metal, which is the usual purchase quantity. Chapter 14 Cost Planning that can be cut from a large roll of foam. Production standards, based on engineering analysis recognizing attainable per- formance, provide for the manufacture of 2,000 pads by two workers in an eight- hour shift. The standard direct labor pay rate is $14 per hour. Manufacturing overhead is applied to units produced using a predetermined over- head application rate of $18 per direct labor hour, of which 88 per hour is fixed manufacturing overhead. Required: a. Calculate the standard absorption cost of a package of 12 stamp pads. b. Stamper Manufacturing Co.'s management is considering a special promotion that would result in increased sales of 1,000 packages of 12 pads per package. Calculate the cost per package that is relevant for this analysis

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