1 20 pom Book P References Marine, Incorporated, manufactures a product that is available in both a flexible and a rigid model. The company has made the rigid model for years; the flexible model was introduced several years ago to tap a new segment of the market. Since introduction of the flexible model, the company's profits have steadily declined, and management has become concerned about the accuracy of its costing system. Sales of the flexible model have been increasing rapidly Overhead is applied to products on the basis of direct labor-hours. At the beginning of the current year, management estimated that $942,500 in overhead costs would be incurred and the company would produce and sell 1,000 units of the flexible model and 12.500 units of the regular model. The flexible model requires 2.6 hours of direct labor time per unit, and the regular model requires 1.30 hours. Direct materials and labor costs per unit are given below. Direct materials cost per unit Flexible $125 $45 $ 70 $ 20 Direct labor cost per unit Required: 1-a Compute the predetermined overhead rate using direct labor-hours as the basis for allocating overhead costs to products. 1-b. Compute the unit product cost for one unit of each model 2. An intern suggested that the company use activity-based costing to cost its products. A team was formed to investigate this idea. It came back with the recommendation that four activity cost pools be used. These cost pools and their associated activities are listed as follows Activity Cost Pool and Activity Measure Purchase orders (number of orders) Rework requests (number of requests) Product testing (number of tests) Machine related (achine hours) Estimated Overhead Cost Flexible Expected Activity Total $23,000 130 530 825 1,875 5,615 13,000 225,000 81,500 Check my work 1 0 oints HCAIVIC HRC, Die Lumpony s pevna ove sicousy ucLaneu, onu inonayene 03 CLUE LULCHICU QUUUL BIC OLLUIDLY US costing system. Sales of the flexible model have been increasing rapidly Overhead is applied to products on the basis of direct labor-hours. At the beginning of the current year, management estimated that $942,500 in overhead costs would be incurred and the company would produce and sell 1,000 units of the flexible model and 12,500 units of the regular model. The flexible model requires 2.6 hours of direct labor time per unit, and the regular model requires 1.30 hours. Direct materials and labor costs per unit are given below. eBook Print References Direct materials cost per unit Direct labor cost per unit Required: Flexible $125 $45 Rigid $70 $ 20 1-a. Compute the predetermined overhead rate using direct labor-hours as the basis for allocating overhead costs to products 1-b. Compute the unit product cost for one unit of each model 2. An intern suggested that the company use activity-based costing to cost its products. A team was formed to investigate this idea, it came back with the recommendation that four activity cost pools be used. These cost pools and their associated activities are listed as follows: Activity Cost Pool and Activity Measure Purchase orders (number of orders) Rework requests (number of requests) Product testing (number of tests) Machine related (machine-hours) Estimated Overhead Cost Expected Activity $ 23,000 13,000 225,000 681,500 $942,500 Flexible: Rigid 130 Total 330 460 75 185 260 1,050 1,200 825 1,875 5,615 6,815 Compute the activity rate for each of the activity cost pools. 3-a. Using activity-based costing, determine the total amount of overhead that would be assigned to each model for the year C ces Activity Cost Pool and Activity Measure Purchase orders (number of orders) Rework requests (number of requests) Product testing (number of tests) Machine related (machine-hours) Estimated Expected Activity Overhead Cost Flexible. Rigid Total $ 23,000 130 330 460 13,000 75. 185 260 225,000 1,050 825 1,875 681,500 1,200 5,615 6,815 $942,500 Compute the activity rate for each of the activity cost pools. 3-a. Using activity-based costing, determine the total amount of overhead that would be assigned to each model for the year 3-b. Using activity-based costing, compute the unit product cost for one unit of each model. Complete this question by entering your answers in the tabs below. Req 1A Req 18 Req 2 Req 3A Req 38 Compute the predetermined overhead rate using direct labor-hours as the basis for allocating overhead costs to products. Predetermined overhead rate per DLH k nces Activity Cost Pool and Activity Measure Purchase orders (number of orders) Rework requests (number of requests) Product testing (number of tests) Machine related (machine-hours) Estimated Overhead Cost Expected Activity Flexible Rigid Total $ 23,000 130 330 460 13,000 75 185 260 225,000 1,050 825 1,875 681,500 $942,500 1,200 5,615 6,815 Compute the activity rate for each of the activity cost pools. 3-a. Using activity-based costing, determine the total amount of overhead that would be assigned to each model for the year. 3-b. Using activity-based costing, compute the unit product cost for one unit of each model. Complete this question by entering your answers in the tabs below. Req 1A Req 18 Req 2 Req 3A Rea 3by Req 38 Compute the unit product cost for one unit of each model.. Unit Product Flexible Rigid Cost ces Rework requests (number of requests) Product testing (number of tests) Machine related (machine-hours) 13,000 225,000 681,500 $942,500 75 185 260 1,050 1,200 825 1,875 5,615 6,815 Compute the activity rate for each of the activity cost pools. 3-a. Using activity-based costing, determine the total amount of overhead that would be assigned to each model for the year. 3-b. Using activity-based costing, compute the unit product cost for one unit of each model Complete this question by entering your answers in the tabs below. Req 1A Req 18 Reg 2 Req 3A Req 38 Compute the activity rate for each of the activity cost pools. Activity Rate Activity Cost Pool Purchase orders Rework requests Product testing Machine-related: per order per request per test per MH requests (number of requests) Product testing (number of tests) Machine related (machine-hours) 13,000 225,000 75 185 260 1,050 825 1,875 681,500 $942,500 1,200 5,615 6,815 Compute the activity rate for each of the activity cost pools. 3-a. Using activity-based costing, determine the total amount of overhead that would be assigned to each model for the year. 3-b. Using activity-based costing, compute the unit product cost for one unit of each model. Complete this question by entering your answers in the tabs below. Req 1A Req 181 Req 2 Req 3A Req 38 Using activity-based costing, determine the total amount of overhead that would be assigned to each model foethe year. Total Amount Flexible Rigid of Overhead ces Rework requests (number of requests) Product testing (number of tests) Machine related (machine-hours) 13,000 225,000 681,500 75 185 260 1,050 825 1,875 1,200 5,615 6,815 $942,500 Compute the activity rate for each of the activity cost pools 3-a Using activity-based costing, determine the total amount of overhead that would be assigned to each model for the year 3-b. Using activity-based costing, compute the unit product cost for one unit of each model. Complete this question by entering your answers in the tabs below. Req 1A Req 18 Req 2 Req 3A Req 38 Using activity-based costing, compute the unit product cost for one unit of each model. (Do not round intermediate calculations and round your answers to 2 decimal places.) Unit Product Cost Flexible Rigid Check my wor