Tag Archives: direct material

How will cost standards be impacted at PEZ Candy Inc. by the rising cost of sugar and labor?

PEZ Candy Inc. produces the popular small candy that is dispensed in collectible flip-top dispensers.  PEZ candy was invented as a breath mint in Vienna, Austria, in 1927.  The name PEZ is derived from “pfefferminz” which is the word for peppermint in German. In the United States, PEZ candies are produced in a factory in […]

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How will the increasing cost of chocolate impact Hershey’s variances?

The price of chocolate had been predicted to increase rapidly beginning in late 2013 and continue into 2014, according to the Wall Street Journal.  The price increase is due to multiple factors, including a shortage of cocoa beans and an increase in demand by consumers. Although the demand for all chocolate has been increasing, consumer […]

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What types of costs are incurred when manufacturing marshmallow cookies?

This posting is about an activity you can use to discuss the various types of manufacturing costs.  The cost object is a box of marshmallow cookies.  The first step is to show (or ask students to watch) this 4:38 minute “How It’s Made” video about marshmallow cookies. Questions 1) What are the direct materials of the […]

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