Deb is setting up a business printing newspapers and magazines. The following standard cost information is available: Newspapers Magazines Selling price 3.00 4.00 Direct materials: - Paper - Ink 0.4 0.5 0.2 0.3 Direct Labour 0.6 0.8 Variable overhead 0.3 0.45 Fixed overhead 0.9 0.8 Profit per unit 0.6 1.15 Budgeted production 1,000 units per week 3,000 units per month Deb is going to start by only printing newspapers. 1 How many units would need to be sold to breakeven? units

Reuben's Deli currently makes rolls for deli sandwiches it produces. It uses 30,000 rolls annually in the production of deli sandwiches. The costs to make the rolls are: Costs Reuben's Deli cost data Amounts Materials Labor Variable overhead Fixed overhead Increments $0.24 per roll 0.40 per roll 0.16 per roll 0.20 per roll A potential supplier has offered to sell Reuben the rolls for $0.90 each. If the rolls are purchased, 30% of the fixed overhead could be avoided. If Reuben accepts the offer, what will the effect on profit be?

Munabhai

Two products were produced for a customer, Product A and Product B.   Product A GHS Product B GHS   Direct material costs   300,000   350,000 Direct labour costs 400,000 270,000 Direct labour hours: Assembly Department Welding Department Finishing Department Hrs 1,000 1,500 750 Hrs 950 800 1,000 Required: i.      Calculate the full cost for each product.                                                                      ii.     What will be the selling price each to make a profit of 40% on cost?

A firm makes a range of running shoes. There are three models – Short; Middle; and Long distance. The products are aimed at different segments of the market. Product costs are computed using an overhead rate based on the labour hour method. Selling prices are set on full cost plus 20%. A unit refers to a pair of running shoes. The following information is available:     Short distance Middle distance Long distance Direct material cost per unit $25 $35 $40 Labour hours per unit 2 hrs 2 hrs 2 hrs Labour rate per hour $12 $12 $12 Total labour hours used 120,000 hrs 24,000 hrs 16,000 hrs Total number of units 60,000 units 12,000 units 8,000 units   Cost driver information:     Short distance Middle distance Long distance No. of machine hours 60,000 48,000 48,000 No. of material orders 30 100 200 No. of sales orders 12 48 63   The total overhead costs for the business amount to $1.2…