Glocker Company makes three products in a single facility. These products have the following unit...
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Accounting
Glocker Company makes three products in a single facility. These products have the following unit product costs: |
Product | |||||||||
A | B | C | |||||||
Direct materials | $ | 33.40 | $ | 49.90 | $ | 56.30 | |||
Direct labor | $ | 20.80 | $ | 23.40 | $ | 14.20 | |||
Variable manufacturing overhead | $ | 1.80 | $ | 1.20 | $ | 0.30 | |||
Fixed manufacturing overhead | 12.90 | 8.50 | 9.10 | ||||||
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Unit product cost | $68.90 | $83.00 | $79.90 | ||||||
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Additional data concerning these products are listed below. | |||||||||
Mixing minutes per unit | 1.80 | 0.60 | 0.10 | ||||||
Selling price per unit | $ | 64.00 | $ | 86.40 | $ | 79.90 | |||
Variable selling cost per unit | $ | 1.20 | $ | 1.70 | $ | 1.70 | |||
Monthly demand in units | 2,600 | 3,900 | 1,900 |
The mixing machines are potentially the constraint in the production facility. A total of 7,110 minutes are available per month on these machines. Direct labor is a variable cost in this company.
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