Hemlock Nutritional Supplements (HNS) provides you with the following accounting records on manufacturing cost for the most recent month:

Production was 60,000 units (cases). Fixed manufacturing overhead was $144,000.

For the coming year, costs are expected to increase as follows: direct materials costs by 30 percent, excluding any effect of volume changes; direct labor by 6 percent; and fixed manufacturing overhead by 13.5 percent. Variable manufacturing overhead per unit is expected to remain the same. 

Required

a. Prepare a cost estimate for a volume level of 48,000 units of product in the upcoming month.

b. Determine the costs per unit for the most recent month and for the upcoming month. 

Transcribed Image Text:

Direct materials. Direct labor... Variable overhead. $126,000 105,000 92,400