Danson Company is a chemical manufacturer that supplies various products to industrial users. The company plans to introduce a new chemical solution, called Nysap, for which it needs to develop a standard product cost. The following information is available on the production of Nysap: (i) Nysap is made by combining a chemical compound (nyclyn) and a solution (salex), and boiling the mixture. A 20% loss in volume occurs for both the salex and the nyclyn during boiling. After boiling, the mixture consists of 9.6 liters of salex and 12 kilograms of nyclyn per 10 -liter batch of Nysap. (ii) After the boiling process is complete, the solution is cooled slightly before 5 kilograms of protet are added per 10-liter batch of Nysap. The addition of the protet does not affect the total liquid volume. The resulting solution is then bottled in 10-liter containers. (iii) The finished product is highly unstable, and one 10-liter batch out of five is rejected at final inspection. Rejected batches have no commercial value and are thrown out. (iv) It takes a worker 35 minutes to process one 10-liter batch of Nysap. Employees work an eight-hour day, including one hour per day for rest breaks and cleanup.
(c) Assuming the following costs, prepare a standard cost card for direct materials and direct labor for one acceptable 10-liter batch of Nysap:

Examples include rent due, utilities due, insurance due, salaries due for office workers, and office supplies. Read more is $15 per hour with a standard fixed cost of $100,000. So the total number of hours to manufacture one unit is 10 hours. Determine your company's standard cost.

Standard cost is described as prescribed cost, estimated future cost, forecasted cost, budgetary unit cost, forecasted cost, or planned cost. Standard cost is often an integral part of a manufacturer's annual profit plan and operating budget.

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