Tb Manufacturing

Tijuana Bronze Manufacturing

Question 1

Valves Pumps Flow Controllers

Material $16.00 $20.00 $22.00

Direct Labor $4.00 $8.00 $6.40

($16 per hour * run labor per unit)

Overhead $17.55 $35.10 $28.08

(439% of Direct Labor)

Standard Unit Cost $37.55 $63.10 $56.48

Overhead calculation:

Receiving $20,000

Materials Handling $200,000

Engineering $100,000

Packing and Shipping $60,000

Maintenance $30,000

Machine Depreciation (10 year life) $270,000

Set-up Labor $2,688

(168 hours * $16 per hour)

Total $682,688

Total Run Labor: $155,600

(9,725 hours * $16 per hour)

Overhead rate: 438.75%

(682,688/155,600)

Question 2

Valves Pumps Flow Controllers

Revenue $57.78 $81.26 $97.07

Material Cost $16.00 $20.00 $22.00

Direct Labor Cost $4.00 $8.00 $6.40

Contribution Margin: $37.78 $53.26 $68.67

Question 3

Valves Pumps Flow Controllers

Material $16.00 $20.00 $22.00

Material Related Overhead $7.69 $9.61 $10.57

Set-up Labor $0.02 $0.05 $0.48

($16*set-up labor/monthly prod*runs)

Run Labor $4.00 $8.00 $6.40

Other $21.30 $21.30 $8.52

Revised Standard Cost: $49.00 $58.95 $47.97

Material Related:

Receiving $20,000

Handling $200,000

Total $220,000

(220,000/458,000) = 48.03%

Other:

Engineering $100,000

Packing and Shipping $60,000

Maintenance $30,000

Machine Depreciation (10 year life) $270,000

Total $460,000

[460,000/10,800 (total machine hours)] $42.59 per hour

Question 4

Valves Pumps Flow Controllers

Material $16.00 $20.00 $22.00

Labor $4.00 $8.00 $6.40

Overhead:

Setup $0.02 $0.05 $0.48

Receiving $0.08 $0.30 $3.90

Handling $0.80 $3.04 $39.00

Packing and Shipping $0.32 $1.10 $10.95...