4 2 points eBook Doaktown Products manufactures fishing equipment for recreational uses. The Miramichi plant produces the company's two versions of a special reel used for river fishing. The two models are the M-008, a basic reel, and the M-123, a new and improved version. Cost accountants at company headquarters have prepared costs for the two reels for the most recent period. The plant manager is concerned. The cost report does not coincide with her intuition about the relative costs of the two models. She has asked you to review the cost accounting and help her prepare a response to headquarters. Manufacturing overhead is currently assigned to products based on their direct labor costs. For the most recent month, manufacturing overhead was $279,200. During that time, the company produced 10,700 units of the M-008 and 2,700 units of the M-123. The direct costs of production were as follows. Print M-008 Direct materials $ 85,600 Direct labor 85,600 M-123 $108,000 54,000 Total $193,600 139,600 References Management determined that overhead costs are caused by three cost drivers. These drivers and their costs for last year were as follows. Cost Driver Number of machine-hours Number of production runs Number of inspections Total overhead Costs $ 96,700 Activity Level M-008 1,000 90,000 92,500 $279,200 10 20 M-123 9,000 30 30 Total 10,000 40 50 Required: a. How much overhead will be assigned to each product if these three cost drivers are used to allocate overhead? What is the total cost per unit produced for each product? b. How much of the overhead will be assigned to each product if direct labor cost is used to allocate overhead? What is the total cost per unit produced for each product? Complete this question by entering your answers in the tabs below. Required A Required B How much overhead will be assigned to each product if these three cost drivers are used to allocate overhead? What is the total cost per unit produced for each product? (Round "Total unit cost" to 2 decimal places.) Total overhead Total unit cost M-008 M-123 5 2 points Munoz Sporting Equipment manufactures baseball bats and tennis rackets. Department B produces the baseball bats, and Department T produces the tennis rackets. Munoz currently uses plantwide allocation to allocate its overhead to all products. Direct labor cost is the allocation base. The rate used is 150 percent of direct labor cost. Last year, revenue, materials, and direct labor were as follows. Sales revenue Direct labor Direct materials Baseball Bats $1,630,000 380,000 570,000 Tennis Rackets $1,200,000 190,000 296,000 eBook Required: Print References a. Compute the profit for each product using plantwide allocation. b. Maria, the manager of Department T, was convinced that tennis rackets were really more profitable than baseball bats. She asked her colleague in accounting to break down the overhead costs for the two departments. She discovered that had department rates been used, Department B would have had a rate of 100 percent of direct labor cost and Department T would have had a rate of 250 percent of direct labor cost. Recompute the profits for each product using each department's allocation rate (based on direct labor cost). a. Using plantwide allocation b. Using department's allocation rate Baseball Bats Profit Tennis Rackets