Beginning and ending work in process inventories are negligible, so they are omitted from the cost of production report. The flavor changeover cost represents the cost of cleaning the bottling machines between production runs of different flavors. Determine the cost per case for each of the four flavors. Round your answers to two decimal places.

Answer and Explanation:

The cost per case for each of the four flavors are shown below:

Particulars                    Orange    ColaLemon LimeRoot Beer

Total Cost Transferred

to finished goods (a)  $19,125       $391,800  $324,000$36,000

No. of Cases (b)              2,500        60,000  50,000         4,000

Cost Per Case

(a ÷ b)                                $7.65         $6.53   $6.48           $9

By dividing the total cost from the number of cases we can get the cost per case for each of the four flavors

u = 30

continuing your method

= +

subtract from both sides

= - thus

= -

= ⇒ u = 30

reducing the scale of the market for a new product.