Waterways Corporation uses very stringent standard costs in evaluating its manufacturing efficiency. These standards are

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Waterways Corporation Uses Very Stringent Standard Costs In Evaluating Its Manufacturing Efficiency These Standards Are 1 (47.6 KiB) Viewed 71 times

Waterways Corporation uses very stringent standard costs in evaluating its manufacturing efficiency. These standards are not ideal" at this point, but the management is working toward that as a goal. At present, the company uses the following standards. Materials Per unit Item Cost Metal 1 lb. 63per lb. 12 oz. $1.00 per lb Plastic Rubber 4 oz 88¢ per lb. Direct labor Item Per unit Cost Labor 15 min. $7.00 per hr Predetermined overhead rate based on direct labor hours = $3.59 The January figures for purchasing production, and labor are: The company purchased 226,100 pounds of raw materials in January at a cost of 78c a pound. Production used 226,100 pounds of raw materials to make 114.000 units in January Direct labor spent 18 minutes on each product at a cost of $6.90 per hour. Overhead costs for January totaled $33,112 variable and $74.000 fixed. Answer the following questions about standard costs.