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CALCULATOR PRINTER VERSION BACK NEXT Problem 4-1A a-e (Video) Combat Fire, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1)
CALCULATOR PRINTER VERSION BACK NEXT Problem 4-1A a-e (Video) Combat Fire, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher. The home model is a high-volume (54,000 units), half-gallon cylinder that holds 2 1/2 pounds of multi-purpose dry chemical at 480 PSI. The commercial model is a low-volume (10,200 units), two-gallon cylinder that holds 10 pounds of multi-purpose dry chemical at 390 PSI. Both products require 1.5 hours of direct labor for completion. Therefore, total annual direct labor hours are 96,300 or [1.5 hours x (54,000 + 10,200)]. Estimated annual manufacturing overhead is $1,568,390. Thus, the predetermined overhead rate is $16.29 or ($1,568,390 96,300) per direct labor hour. The direct materials cost per unit is $18.50 for the home model and $26.50 for the commercial model. The direct labor cost is $19 per unit for both the home and the commercial models. The company's managers identified six activity cost pools and related cost drivers and accumulated overhead by cost pool as follows. Estimated Use of Drivers by Product Activity Cost Pools Receiving Cost Drivers Pounds Estimated Overhead Estimated Use of Cost Drivers $87,100 335,000 Forming Machine hours 152,950 Assembling Number of parts 410,130 217,000 Home 215,000 35,000 27,000 165,000 Commercial 120,000 8,000 52,000 Testing Number of tests 44,880 25,500 15,500 10,000 Painting Gallons 52,580 5,258 3,680 1,578 Packing and shipping Pounds 820,750 $1,568,390 335,000 215,000 120,000 Under traditional product costing, compute the total unit cost of each product. (Round answers to 2 decimal places, e.g. 12.50.) Home Model Commercial Model Total unit cost $ $ Hades ABC prepare a schedule showing the computations of the activity-based overhead rates (per cost driver). (Round overhead rate to 2 decimal places, e.g. 12.25.)
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