Bailey Publishing is a new publishing company in Windhoek, Namibia. They published their first batch of 20 books in October this
year. The first 2 batches cost the following on direct labour, at a labour rate of N$20 per hour:
– First batch N$4,000
– First 2 Batches N$7,200
The initial labour rate was set on a trial basis and the company has agreed on a 10% increase, starting from the third batch. Other
manufacturing costs are as follow per book:
Direct materials N$250
Variable manufacturing overheads N$100
Fixed manufacturing overheads N$80
So far, the company has produced 2 batches in a month, which earned them monthly sales of N$34,000.
The management accountant expects to increase monthly production over time. The selling price and learning rate is expected to
remain constant.
Required: Calculate the conversion cost charged to book number 70.
Bailey Publishing is a new publishing company in Windhoek, Namibia. They published their first batch of 20 books in October this year. The first 2 batches cost the following on direct labour, at a labour rate of N$20 per hour: – First batch N$4,000 – First 2 Batches N$7,200 The initial labour rate was set on a trial basis and the company has agreed on a 10% increase, starting from the third batch. Other manufacturing costs are as follow per book: Direct materials N$250 Variable manufacturing overheads N$100 Fixed manufacturing overheads N$80 So far, the company has produced 2 batches in a month, which earned them monthly sales of N$34,000. The management accountant expects to increase monthly production over time. The selling price and learning rate is expected to remain constant.
Leave an answer
You must login to add an answer.
1 Answer