Question

Light Manufacturers produces energy-efficient light bulbs. In one 8-hour shift, they incur the following costs to make 4,000 light bulbs: Use 250 lbs. of glass for a total cost of $1,016. Use 500 lbs. of coal to keep the fire going to melt and shape glass for a total cost of $1,280. Use 8,000 filaments for a total cost of $1,120. Use 4,800 feet of wire for a total cost of $156. Use 4,000 light bulb bases for a total cost of $1,480. Use 128 man-hours for a total cost of $2,500. What are the direct material costs for making one light bulb?

A) $0.943.
B) $0.904.
C) $1.224.
D) $1.263.

Answer 1

The correct option is D) $1.263.

Explanation:

Consider the provided information.

Direct materials is a product cost.

First calculate the direct material cost as shown:

Direct material cost = Glass cost + Shape glass cost + Filament cost + Wire cost + Bulb bases cost

Direct material cost = $1,016+$1,280+$1,120+$156+$2,500

Direct material cost = $5,052

Now we need to find the direct material costs for making one light bulb.

Since they are making 4,000 light bulbs so divide the Direct material cost with the number of bulbs gives the direct material cost of one bulb.

Direct material costs of one light bulb =
`(\$5052)/(4000) =\$1.263`

Hence, the correct option is D) $1.263.