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Operations Costing
Vermont Instruments manufactures two models of calculators. The finance model is the Fin-X and the scientific model is the Sci-X. Both models are assembled in the same plant and require the same assembling operations. The difference between the models is in the cost of the parts. The following data are available for June.
Fin-X
Sci-X
Total
Number of units
10,000
40,000
50,000
Parts cost per unit
$20
$25
Other costs:
Direct labor
$ 62,000
Indirect materials
17,500
Overhead
70,500
$150,000
Required
Vermont Instruments uses operations costing and assigns conversion costs based on the number of units assembled. Compute the cost per unit of the Fin-X and Sci-X models for June.
Develop a direct labor budget for the months of June, July, and August and for each type of direct labor.
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