Question

Hofburg’s standard quantities for 1 unit of product include 2 pounds of materials and 1.5 labor hours. the standard rates are $2 per pound and $7 per hour. the standard overhead rate is $8 per direct labor hour. the total standard cost of hofburg’s product is

Answer 1

To determine the cost of production of a single unit of Hofburg's product, we just have to multiply the number of pounds to the cost per pound and the number of hour to the cost per hour.
That is,
                           total cost = ($2/lb)(2 lb) + ($7/h)(1.5 h) + ($8/h)(1.5 h)
                                  total cost = $54
Thus, the cost of the production is $54/unit.