My company sells household cleaning products. The research department has develo

Question

My company sells household cleaning products. The research department has developed a new cleaner for which a standard cost must be determined. The new cleaner is made by mixing 18 quarts of triphate solution and 8 pounds of sobase granules and boiling the mixture for several minutes. After the solution has cooled, 4 ounces of methage are added. This recipe produces 15 quarts of the cleaner, which is then packaged in one-quart plastic dispenser bottles. The raw materials costs are:
Triphate solution $0.45 per quart
Sobase granules $0.90 per pound
Methage $1.40 per ounce
Bottle $0.25 each

Using the preceding data, calculate the raw material cost for one bottle of new cleaner.

Explanation / Answer

So 15 Quart of cleaner requires :- 18Q of Triphate Soln = 18*$0.45 = $8.10 8Lb of Sobase = 8*$0.90 = $7.20 4 Oz of Methage = 4*$1.40 = $5.60 ----------------------------------------- Total Raw Mat cost for 15Q = $20.90 SO Per Q cost = $20.90/15 = $1.39 Add cost of 1 Bottle = $0.25 ------------------------------------- Cost per bottle = $1.64

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