ABC Manufacturing, Inc. produces three gadgets (Ace, Best, and Champ) in two departments, Machining and Assembly....

 

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ABC Manufacturing, Inc. produces three gadgets (Ace, Best, and Champ) in two departments, Machining and Assembly. Each product requires one hour of direct labor for completion. The following table provides production and cost data for the year. Ace Best Champ Total Number of units 25,000 15,000 5,000 45,000 Machine hours 2,500 1,500 2,000 6,000 Direct materials Direct labor $1,000,000 375,000 $450,000 $275,000 $1,725,000 225,000 75,000 675,000 Overhead Machining 900,000 Assembly 450,000 1,350,000 $3,750,000 Required: Total overhead Tot costs Use the plantwide allocation method to determine the unit cost for each product. The allocation bases to choose from are 1. Machine hours. 2. Direct labor costs. ABC Manufacturing, Inc. produces three gadgets (Ace, Best, and Champ) in two departments, Machining and Assembly. Each product requires one hour of direct labor for completion. The following table provides production and cost data for the year. Ace Best Champ Total Number of units 25,000 15,000 5,000 45,000 Machine hours 2,500 1,500 2,000 6,000 Direct materials Direct labor $1,000,000 375,000 $450,000 $275,000 $1,725,000 225,000 75,000 675,000 Overhead Machining 900,000 Assembly 450,000 1,350,000 $3,750,000 Required: Total overhead Tot costs Use the plantwide allocation method to determine the unit cost for each product. The allocation bases to choose from are 1. Machine hours. 2. Direct labor costs.

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Unit Cost Calculation using Plantwide Overhead Allocation Method Total Overhead Machining 450000 Ass... View the full answer