One of MowTown Manufacturings products is a small lawnmower. Two processing departments are involved in the mowers

One of MowTown Manufacturing’s products is a small lawnmower. Two processing departments are involved in the mower’s production. The deck is assembled in one department, and a second department assembles and installs the engine. There is no beginning or ending work in process in either department. During May, the company incurred the following costs in the manufacture of

6,000 lawnmowers:

Instructions
a. Compute the following per-unit costs for the month of May.
1. A deck assembly transferred to the Engine Department.
2. Assembling an engine and installing it.
3. A completed lawnmower.
4. Materials used in assembling a deck.
5. Direct labor cost of assembling and installing an engine.
b. Which of these unit costs would be most useful to management in evaluating the overall monthly efficiency of the Engine Department? Explain yourreasoning.

Transcribed Image Text:

Deck Department Department Engine Direct materials Direct labor Manufacturing overhead $192,000 48,000 54,000 $480,000 108,000 66,000