Question
Chhom, Inc., manufactures and sells two products: Product F9 and Product U4. Data concerning the expected production of each product and the expected total direct
Chhom, Inc., manufactures and sells two products: Product F9 and Product U4. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below:
Expected Production | Direct Labor-Hours Per Unit | Total Direct Labor-Hours | |
Product F9 | 300 | 6.0 | 1,800 |
Product U4 | 600 | 3.0 | 1,800 |
Total direct labor-hours | 3,600 | ||
The direct labor rate is $27.80 per DLH. The direct materials cost per unit is $271.90 for Product F9 and $272.20 for Product U4.
The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Estimated | Expected Activity | |||||
Activity Cost Pools | Activity Measures | Overhead Cost | Product F9 | Product U4 | Total | |
Labor-related | DLHs | $ | 38,988 | 1,800 | 1,800 | 3,600 |
Production orders | orders | 61,910 | 400 | 600 | 1,000 | |
Order size | MHs | 126,150 | 3,800 | 3,700 | 7,500 | |
$ | 227,048 | |||||
If the company allocates all of its overhead based on direct labor-hours using its traditional costing method, the overhead assigned to each unit of Product U4 would be closest to: (Round your intermediate calculations to 2 decimal places.)
rev: 03_24_2018_QC_CS-119201
Multiple Choice
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$185.73 per unit
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$189.21 per unit
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$32.49 per unit
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$50.46 per unit
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