standard cost card

iainiow

Hi,

I am doing the dec 07 PEV practice exam and im having a brain block on creating the standard cost card (task 1.2)

Ive created the top two rows, loose tea and direct materials, but i cant for the life of me work out how to get the quantity of 0.2 for direct materials and fixed production overhead. alas AAT arent as good at showing workings in PEV practive answers as FRA papers.

anyone care to offer a desperate man some assistance?? :confused1:

SandyHood

Have a look at mine if you wish
send an email with this as the exact subject line (it must be precise to work)
PEV Dec 07 Sandy Answer
My answer comes as an automated reply after my out of office

i cant for the life of me work out how to get the quantity of 0.2 for direct materials and fixed production overhead

Standard cost card for the production of 1,000 tea bags
Quantity Unit price Total cost

Direct materials (loose tea) .................. 3kgs
Direct materials (bags for the tea)........ 1,000
Direct labour (machine operators)........ 0.2hrs
Fixed production overheads .................. 0.2hrs

I'm guessing you mean 0.2 hours

Budgeted batches 20,000
Budgeted labour hours 4,000

So Budgeted labour hours........= 0.2 labour hours
........Budgeted batches ........ per batch

And fixed overhead is absorbed on a labour hour basis