a) Exercise 1: What is the Gross Profit per Unit (dollars not %) for the XM1 drive using the Traditional Costing system? See circle on the printed exercise

ACG 2071 Chapter 5 JOURNAL Activity-Based Costing EXERCISE 1: Eastern Technologies produces two models of external computer hard drives: XM1 and XM2. Currently, manufacturing overhead of $460,000 is allocated using machine hours as the single allocation base for both products. Following is a breakdown of the machine hours used for the period to produce each product: XM2 Traditional Costing Machine Hours XM1 1,950 hrs 3,800 hrs Using this traditional allocation system, how much overhead would be allocated to each product: Overhead Costs/ Cost Allocation Rate Quantity of Allocation Base $ Machine hrs $ per Machine hr Use the rate to allocate overhead and calculate a per unit amount: Activity Cost Allocation Rate # of Units Cost per Actual Quantity of Activity Allocated Amount Unit XM1 hrs X $ per machine hr =$ 1 9,750 $ XM2 hrs X $ per machine hr =$ | 14,475 $ Complete the following analysis: Traditional Costing XM1 XM2 Selling Price per Unit $89.00 $149.00 Direct Costs: Direct Materials (per unit) Direct Labor (per unit) Allocated Overhead (per unit) (from above) 24.00 18.00 38.00 27.00 Total Cost per Unit: Gross Profit Per Unit (Price - Total cost): S $ Gross Profit Margin % (Gross Profit / Price) % %