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3.1. Hong Ha Company manufactures pillows using an activity-based costing system. The following information is provided for the month of June: Activity Materials handling Assembling
3.1. Hong Ha Company manufactures pillows using an activity-based costing system. The following information is provided for the month of June: Activity Materials handling Assembling Packaging Estimated Indirect Activity Costs $ 3,150 13,860 3123 Allocation Base Number of parts Number of parts Number of pillows Estimated Quantity of Allocation Base 4,200 parts 4,200 parts 1,050 pillows Each pillow consists of 4 parts and the total direct materials cost per pillow is $3.50 1. What is the total cost of materials handling and assembling for each pillow? 2. What is the total cost of packaging per pillow? 3. What is the total manufacturing cost per pillow? 4. If the cost to purchase the same pillow from a supplier is $21.00, what should Sleep Tight do to maximize profits? a
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