cost management problem 494566

Mina’s Tricks ‘N Treats Mina’s Tricks ‘N Treats sells premium dog treats and cute dog accessories for the most fashion forward dogs around. Your mission, should you choose to accept it, is to provide the owner of Mina’s Tricks ‘N Treats with some helpful cost analysis. See, Mina’s Tricks ‘N Treats isn’t doing so hot in comparison to its competitors and the owner wants to know why. All the information to produce Mina’s famous dog biscuits has been gathered and is presented for your analysis below. Mina’s Tricks ‘N Treats requires two types of direct labor to make dog biscuits: Production and Inspection. Production employees are paid $10.00 per hour. Inspection employees are paid $20.00 per hour and inspections are performed in batches of 300 biscuits. Standards have been established for one biscuit. Production…………………………………………………………. 1 min per biscuit Inspection………………………………………………………….. 2 hours per batch During the current month Mina’s Tricks ‘N Treats produced 300,000 biscuits and incurred the following direct labor costs: Production……………………………….. 4,900 hours…………………………. $52,150 Inspection………………………………… 2,200 hours…………………………. $43,000 Mina’s Tricks ‘N Treats requires two types of direct materials to make dog biscuits: Peanut Butter and Bacon. Standards have been established based on one biscuit. Peanut Butter……………………………………………………. .6 unit at $0.30 per unit Bacon………………………………………………………………… .4 unit at $0.60 per unit Also during the current month, Mina’s Tricks ‘N Treats noted direct material costs to be as follows: Materials purchased: Peanut Butter…………………………………………………… 200,000 units at $0.28 per unit Bacon……………………………………………………………….. 120,000 units at $0.65 per unit Of the materials purchased, the following were used: Peanut Butter…………………………………………………… 198,000 units Bacon……………………………………………………………….. 113,000 units Mina’s Tricks ‘N Treats has the following standard overhead rates: Standard variable overhead rate………………………. $6.00 per direct-labor…