Drury's produces three products and have traditionally used a costing system which absorbs the overheads according...

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Drury's produces three products and have traditionally used a costing system which absorbs the overheads according to a labour hour rate based on direct labour hours which are currently 88,000 hours. The following overhead cost figures are from the current year; Set up costs 30,000 Order receiving costs 1,195,000 Packing 250,000 Engineering Total overheads 373,000 1,848,000 The direct costs per unit for products X, Y and Z are; X Y Z Direct Labour () 8 12 6 Direct Material () 25 20 11 Units Produced 30,000 20,000 8,000 Labour cost is 6 per hour. Drury's produces three products and have traditionally used a costing system which absorbs the overheads according to a labour hour rate based on direct labour hours which are currently 88,000 hours. The following overhead cost figures are from the current year; Set up costs 30,000 Order receiving costs 1,195,000 Packing 250,000 Engineering Total overheads 373,000 1,848,000 The direct costs per unit for products X, Y and Z are; X Y Z Direct Labour () 8 12 6 Direct Material () 25 20 11 Units Produced 30,000 20,000 8,000 Labour cost is 6 per hour.