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QUESTION35. Aldebaran designs, produces and markets two types of fireworks: Ch...
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QUESTION35. Aldebaran designs, produces and markets two types of fireworks: Chinese Dragon and Space Tornado. They are made from chemical components assembled in workshop 1 and then in workshop 2.
The production parameters of these two products are given below:
By unit of firework
|
Chinese Dragon
|
Space Tornado
|
Chemical Components / firework
|
50
|
120
|
Direct manual workforce workshop 1 (in hours)
|
2 hours
|
2 hours
|
Machine workshop 1 (in hours)
|
5 hours
|
6 hours
|
Direct manual workforce workshop 2 (in hours)
|
3 hours
|
4h
|
Machine workshop 2 (in hours)
|
0.5h
|
1h
|
The unit cost of chemical components is $1. Direct labor costs $4 per manual hour in Workshop 1 and $4.5 per manual hour in Workshop 2.
The operating costs of the machines are $3.5 per machine hour in Workshop 1 and $2.5 per machine hour in Workshop 2.
In July, we produced and sold 1,000 Chinese Dragons and 2,000 Space Tornados.
What is the direct unit cost of a Space Tornado?