Question

Consider the following for the costs of a pair of jeans: Direct material costs: $2 per yard and 3 yards are needed Direct labor costs: $20 per hour and 0.5 hours are needed Overhead costs: $5 per hour and 1 hour is needed What is the total cost to make a pair of jeans

Answer 1

The total cost to make a pair of jeans is $21.

The entire cost to produce a pair of jeans is determined as follows:

Total cost for pair of jeans = Direct material cost + Direct labor cost + Overhead cost

= $ 6 + $ 10 + $ 5

= $ 21

Thus, a pair of jeans costs $21 to create in total.

Direct material cost is calculated as follows:

Direct material costs: $2 per yard and 3 yards are needed for a pair

Direct material cost = 3 yards * $ 2 per yard = $ 6

Direct material labor is calculated as follows:

Direct labor costs: $20 per hour and 0.5 hours are needed for a pair

Direct labor cost = 0.5 hours * $ 20 = $ 10

Overhead cost is calculated as follows:

Overhead costs: $5 per hour and 1 hour is needed for a pair

Overhead costs = 1 hour * $ 5 = $ 5

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