Jim Hetzel manufactures and sells homemade wine, and he wants to develop a stand

Question

Jim Hetzel manufactures and sells homemade wine, and he wants to   develop a standard cost per gallon. The following are   required for production of a 50 -gallon   batch. 3,000 ounces of grape concentrate   at $0.040 per ounce 54 pounds of granulated sugar   at 0.350 per pound 60 lemons at 0.600 each 50 yeast tablets at 0.250 each 50 nutrient tablets at 0.200 each 2,500 ounces of water at 0.004 per ounce Jim estimates that 4% of the grape concentrate is wasted, 10% of the sugar is lost, and 20% of the lemons cannot be   used. Instructions: Compute the standard costs of the ingredients for one gallon of   wine. (Carry the computations to two decimal places.) Ingredient Amount Per Gallon Unit of Measure Standard Waste Standard Usage Standard Price Standard Cost Per   Gallon Title Amount ounces Percentage Formula Amount Formula Title Amount pounds Percentage Formula Amount Formula Title Amount each Percentage Formula Amount Formula Title Amount tablet Percentage Formula Amount Formula Title Amount tablet Percentage Formula Amount Formula Title Amount ounces Percentage Formula Amount Formula Formula Jim Hetzel manufactures and sells homemade wine, and he wants to   develop a standard cost per gallon. The following are   required for production of a 50 -gallon   batch. 3,000 ounces of grape concentrate   at $0.040 per ounce 54 pounds of granulated sugar   at 0.350 per pound 60 lemons at 0.600 each 50 yeast tablets at 0.250 each 50 nutrient tablets at 0.200 each 2,500 ounces of water at 0.004 per ounce Jim estimates that 4% of the grape concentrate is wasted, 10% of the sugar is lost, and 20% of the lemons cannot be   used. Instructions: Compute the standard costs of the ingredients for one gallon of   wine. (Carry the computations to two decimal places.) Ingredient Amount Per Gallon Unit of Measure Standard Waste Standard Usage Standard Price Standard Cost Per   Gallon Title Amount ounces Percentage Formula Amount Formula Title Amount pounds Percentage Formula Amount Formula Title Amount each Percentage Formula Amount Formula Title Amount tablet Percentage Formula Amount Formula Title Amount tablet Percentage Formula Amount Formula Title Amount ounces Percentage Formula Amount Formula Formula

Explanation / Answer

Formula :
1. Amount per Gallon = Amount Given in the original table / 50

2. Standard Usage = Amount per Gallon*(1 + Standard Waste %)

3. Standard Cost per Gallon = Standard Usage * Standard Price

Ingredient Amount Per Gallon Unit of Measure Standard Waste Standard Usage Standard Price Standard Cost Per Gallon Grape Concentrate 60 Ounces 4% 62.4 $0.040 $2.496 Granulated Salt 1.08 Pounds 10% 1.188 $0.350 $0.416 Lemons 1.2 Number 0% 1.2 $0.600 $0.720 Yeast Tablet 1 Number 0% 1 $0.250 $0.250 Nutrient Tablet 1 Number 0% 1 $0.200 $0.200 Water 50 Pounds 0% 50 $0.004 $0.200 TOTAL $4.282

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