Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Atlanta Systems produces two products, Product A, which sells for $600 per unit, and Product B, which sells for $1,100 per unit, using three activities:
Atlanta Systems produces two products, Product A, which sells for $600 per unit, and Product B, which sells for $1,100 per unit, using three activities: Design, which uses engineering hours as the cost driver; Machining, which uses machine hours as the cost driver; and Inspection, which uses the number of batches as the cost driver. The cost of each activity and usage of the cost drivers are as follows: Activity Pool (Driver) Design (engineering hours) Machining (machine hours) Inspection (batches) Cost of Pool $ 220,000 2,400,000 220,000 Usage by Product A 114 2,280 36 Required: a. Calculate the activity rate for design. b. Calculate the activity rate for machining. c. Calculate the activity rate for inspection. d. Determine the indirect costs assigned to Product A. e. Determine the indirect costs assigned to Product B. f. Determine the manufacturing cost per unit for Product A. Note: Round your answer to the nearest whole dollars. g. Determine the manufacturing cost per unit for Product B. Note: Round your answer to the nearest whole dollars. h. Determine the gross profit per unit for Product A. Usage by Product B 136 2,720 44 Atlanta manufactures 12,500 units of Product A and 8,050 units of Product B per month. Each unit of Product A uses $100 of direct materials and $45 of direct labor, while each unit of Product B uses $140 of direct materials and $75 of direct labor. Note: Round your intermediate calculations and final answer to the nearest whole dollars. i. Determine the gross profit per unit for Product B. Note: Round your intermediate calculations and final answer to the nearest whole dollars.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started