Question

Oxnard Industries produces a product that requires 2.6 pounds of materials per unit. The allowance for waste and spoilage per unit is .3 pounds and .1 pounds, respectively. The purchase price is $3 per pound, but a 2% discount is usually taken. Freight costs are $.15 per pound, and receiving and handling costs are $.10 per pound. The hourly wage rate is $10.00 per hour, but a raise which will average $.25 will go into effect soon. Payroll taxes are $1.00 per hour, and fringe benefits average $2.00 per hour. Standard production time is 1 hour per unit, and the allowance for rest periods and setup is .2 hours and .1 hours, respectively. The standard direct materials quantity per unit is a. 2.6 pounds. b. 2.7 pounds. c. 2.9 pounds. d. 3.0 pounds. 4. The standard direct labor hours per unit is
a. 1 hour.
b. 1.1 hours.
c. 1.2 hours.
d. 1.3 hours.

Answer 1

Answer:

standard direct materials quantity per unit =  3.00 Pounds

so correct option is d. 3.0 pounds

Direct Labor is = 1.3 hours

correct option is d. 1.3 hours.

Explanation:

given data

materials = 2.6 pounds

waste  = 0.3 pounds

spoilage =  0.1 pounds

discount = 2 %

Freight costs = $.15 per pound

handling costs = $.10 per pound

wage rate = $10.00 per hour

Payroll taxes = $1.00 per hour

fringe benefits average = $2.00 per hour

Standard production time = 1 hour per unit

to find out

standard direct materials quantity per unit and The standard direct labor hours per unit

solution

standard direct materials quantity per unit = Net Raw Material Required + waste + Spoilage      ............1

standard direct materials quantity per unit =  2.6 + 0.3 + 0.10

standard direct materials quantity per unit =  3.00 Pounds

so correct option is d. 3.0 pounds

and

Direct Labor is = Net Hrs Required + Allowance + Rest

Direct Labor is = 1 + 0.2+ 0.1

Direct Labor is = 1.3 hours

correct option is d. 1.3 hours.