Production standards based on engineering analysis

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Reference no: EM13581293

A cost analyst for Stamper Manufacturing Co. has assembled the following data about the Model 24 stamp pad:

The piece of sheet metal from which 8 pad cases can be made costs $0.16.

This amount is based on the number of sheets in a 4,000-pound bundle of sheet metal, which is the usual purchase quantity.

The foam pad that is put in the case costs $0.08, based on the number of pads that can be cut from a large roll of foam.

Production standards, based on engineering analysis recognizing attainable performance, provide for the manufacture of 1,770 pads by 5 workers in an eight-hour shift. The standard direct labor pay rate is $11.75 per hour.

Manufacturing overhead is applied to units produced using a predetermined overhead application rate of $16 per direct labor hour, of which $6.35 per hour is fixed manufacturing overhead.
Required:

(a)Calculate the standard absorption cost of a package of 16 stamp pads. (Round your intermediate calculations and final answer to 2 decimal places. Omit the "tiny_mce_markerquot; sign in your response.)

Reference no: EM13581293

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