A manufacturer of potting soil has the following financial data:

Pounds produced and sold		23,900
Sales		$189,800
Less: Variable manufacturing costs		121,000
Fixed manufacturing costs		10,000
Variable selling and administrative costs		30,900
Fixed selling and administrative costs		15,900
Net operating income		$12,000

What is the companys degree of operating leverage?

Milsaps Company produces sportsmens digital scales. In preparing the current budget, Milsaps controller estimates a total of $290,000 in direct materials cost, $240,000 in direct labor cost, and $304,800 in manufacturing overhead costs. Since much of the production process requires skilled workers to assemble the scales, direct labor cost is used as the overhead application base. At the end of the period, Milsaps reported actual results as follows: direct materials cost of $289,000, direct labor cost of $208,000, and manufacturing overhead cost $259,490.

How much manufacturing overhead did Milsaps apply during the year?

Megan Industries manufactures several products including a basic case for a popular smart phone. The company is considering adopting an activity-based costing approach for setting its budget. The companys production activities, budgeted activity costs, and cost drivers for the coming year are as follows.

Calculate the activity-based unit cost of the smart phone case.

Stockin Company produces Tablets and Books. Total overhead costs traditionally have been allocated on the basis of direct labor hours. After implementing activity-based costing, managers determined the following cost pools and cost drivers. They also decided that general costs should no longer be allocated to products.

Activity Pool		Department Costs		Cost driver
Binding		$275,835.00		Number of units
Printing		789,929.00		Machine hours
Product design		200,988.00		Change orders
General		805,948.00		None
Total overhead costs		$2,072,700.00

Other information is as follows:

		Tablets		Books
Units		77,700		19,425
Direct materials cost per unit		$4.00		$12.00
Direct labor cost per unit		$5.00		$10.00
Direct labor hours		32,900		16,450
Machine hours		137,200		102,900
Change orders		1,861		3,722

Determine the unit product cost for Tablets using the activity-based costing system