Question

Vaughn's Bakery makes a variety of home-style cookies for upscale restaurants in the Atlanta metropolitan area. The company's best-selling cookie is the double chocolate almond supreme. Vaughn's recipe requires 10 ounces of a commercial cookie mix, 5 ounces of milk chocolate, and 1 ounce of almonds per pound of cookies. The standard direct materials costs are $0.80 per pound of cookie mix, $8 per pound of milk chocolate, and $14 per pound of almonds. Each pound of cookies requires 1 minute of direct labor in the mixing department and 5 minutes of direct labor in the baking department. The standard labor rates in those departments are $12.90 per direct labor hour (DLH) and $19 per DLH, respectively. Variable overhead is applied at a rate of $32.80 per DLH; fixed overhead is applied at a rate of $60 per DLH.

Calculate the standard cost for a pound of Vaughn's double chocolate almond supreme cookies. (Round answer to 2 decimal places, e.g. 3.51.)

Answer 1

Standard cost per pound of Vaughan Double chocolate almond Supreme cookies:
Material cost:
Cookie mix (10*0.80/16)				0.5
Milk Chocolate (5 *8/16)				2.5
Almond (1*14/16)				0.875
Total Material cost					3.875
Labour cost:
Mixing deptt (1 minutes @ 12.90 /60)				0.215
Baking deptt (5 min @19/60)				1.583
Total Labour cost					1.798
Variable OH (6 min @ 32.80 /60)					3.28
Fixed OH (6 min @ 60/60)					6
Std cost per pound					14.953