Custom Design Manufactures T-Shirts for New Parents and Grandparents by Turning

Essay

Custom Design manufactures t-shirts for new parents and grandparents by turning a client's newborn baby's picture into a design on the shirt.The following information has been provided by various units within Custom Design's departments.The company purchases cotton t-shirts in bundles of 100 at a price of $400 per bundle.Custom Design has to pay shipping charges of $10 per bundle.The process of transferring pictures onto the shirts costs $0.75 per shirt.Each shirt is boxed in a cardboard box that costs $0.15 each.It takes one worker 10 minutes to prepare a shirt and transfer the picture onto the shirt and another worker 5 minutes to check the shirt for flaws in the printing and package the shirt.Workers are paid $15 per hour.Custom Design applies overhead at a rate of 100% of direct labor cost.
Required:
Compute the standard cost of producing one t-shirt.