Consider the following data for two products of Gitano Manufacturing (Loss amounts should be indicated with a minus sign. Round your intermediate calculations and "OH rate and cost per unit answers to 2 decimal places.) Sumber of units produced Direct bor boat (625 per DLR) Direct materials cast 11,500 units 0.11 U per unit 1.800 units 0.27 D per unit 6 2.30 unit 6 9.625 Activity Machine setup Materials handling Quality control inspections 14,010 6148,835 Required: Answer is complete but not entirely correct. 1. Using direct labor hours as the basis for assing overhead costs, determine the total production cost per unit for each product line 8500 per direct labor Overhead.costs Dired labor hours Overhead Assigned $143.033S 1.751 Activity Plantwide OH Total Overhead Units Produced Ow Cost per is the stor e $ $ 85.00 Overhead costs Direct labor hours per dired labor hour 148.835 1,751 Activity Driver 1.265S 486 Total Overhead Produced Overhead Assigned Produd A Produd B OH Cost per patwide OH Tale 85.00 $ 85.00 S 107,525 41,310 11,500S 1,800 9.35 22.95 $ $ Total manufacturing cost per unit: Direct material cost per unit Direct labor cost per unit Overhead cost per una Total manufacturing cost Product Products 1.90 $ 2.30 2. 756 .75 935 22 95 14.00 $ 32.00 $ 2. the market price for Product A is $19.12 and the market price for Product Bis 561, determine the profit or loss per unit for each product Product A Product B Market price $ 19.17S $100 Manufacturing cost per unit (14.00) (3200) Protoss) per unit 5 17 $ 29.00 3. Consider the following additional information about these two product lines. ABC is used for assigning overhead costs to products, what is the cost per unit for Product A and for Product B? ProcedA Produd Setups setups Number of setups required for production Number of parts required Inspection hours required partit hours 56 hours 215 $ 9825 $ 350 89 per setup Machine setup Overhead costs Number of setups Materials handling Overhead costs Number of parts Quality control $ 2,11538 55.000s 26 per part S 84010S 310.00 per inspection Overhead costs inspection hours Overhead Assed Activity Driver Activity Rate Product Machine setup Material handling 2807 350 09 2.115 30 parts persetup per part b er inspection A Acivity rate Product A Machine setup 8 l setups s 350 89 2,115.39 per setup per part 2,807 33 845 erials handing 15 l parts inspection hours 31000 per inspection 17,360 54013 Quality control Total overhead costs assigned Total units produced Overhead cost per unit Product B 11500 4.70 Machine setup 20 7,018 setups parts 10 350 89 2,115 39 310.00 per setup per part per inspection hour 21,154 215 Inspection hours 66,650 94,822 Materials handling Quality control Total overhead costs assigned Total units produced Overhead cost per unit Total manufacturing costs Dired Materials per unit Dired Labor per unit Overhead per unit Total manufacturing cost per unit 1.800 5268 Product A Product 5268 Market price Manufacturing cost per unit Profit(loss) per unit Product 19.17 (9.35) 9.82 Product B 61.00 (61.73) (0.73) $ $ 4.2 Based on your results in part 4, should the profit or loss per unit for each product influence company strategy? No Yes
