A Machine Requires Five Hours to Make a Unit of Product

question 54

Essay

A machine requires five hours to make a unit of Product A and six hours to make a unit of Product B. Last month the machine operated for 250 hours producing a total of 60 units. How many units of Product A were produced?

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Definitions:

Standard Cost Card

A detailed listing of the standard amounts of inputs and their costs that are required to produce one unit of a specific product.

Standard Variable Cost

The budgeted, per-unit cost of variable elements of production, such as materials and labor, under normal operating conditions.

Direct Materials

The cost of raw materials that can be directly traced to the production process.

Materials Price Variance

The difference between the actual cost of materials used in production and the expected standard cost, which can indicate changes in material costs over time.