Bacon Company Makes Four Products in a Single Facility

question 61

Multiple Choice

Bacon Company makes four products in a single facility.These products have the following unit product costs:

Additional data concerning these products are listed below.

The grinding machines are the constraint in the production facility.A total of 53,600 minutes are available per month on these machines.Direct labor is a variable cost in this company.How many minutes of grinding machine time would be required to satisfy demand for all four products?

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Definitions:

Gross Profit Method

A technique used for estimating inventory and cost of goods sold, calculated by applying a gross profit percentage to sales.

Retail Inventory Method

An accounting method used by retailers to estimate inventory value by converting retail prices to cost prices.

Perpetual Inventory

A system of accounting for inventory that records the sale or purchase of inventory immediately through the use of computerized point-of-sale systems and enterprise asset management software.