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Coronado is an electronics components manufacturer. Information about the company's two products follows: AM-2 FM-9 Units produced 20,000 6,000 Direct labor hours required for production
Coronado is an electronics components manufacturer. Information about the company's two products follows: AM-2 FM-9 Units produced 20,000 6,000 Direct labor hours required for production 10,000 15,000 Units per batch 4,000 600 Shipping weight per unit 0.50 lbs. 10 lbs. The company incurs $830,000 in overhead per year and has traditionally applied overhead on the basis of direct labor hours. (a) Your answer is correct. (i) How much overhead will be allocated to each product using the traditional direct labor hours allocation base? (Round per unit rates to 2 decimal places, e.g. 3.54 and final answers to O decimal places, e.g. 45,286.) $ Overhead allocated to each product AM-2 FM-9 332000 $ 498000 Assume that Coronado has identified three activity cost pools. Pool Cost Cost Driver Assembly $500,000 Direct labor hours Setup 36,000 Number of setups (1 per batch) Packaging 294,000 Weight (i) Given these activity pools and cost drivers, how much overhead should be allocated to each product? (Round per unit rates to 2 decimal places, e.g. 3.54 and final answers to O decimal places, e.g. 45,286.) Total allocated overhead AM-2 FM-9 496000 $ 169200 (ii) What overhead cost per unit will be allocated to each product? (Round answers to 2 decimal places, e.g. 15.25.) $ Overhead cost per unit AM-2 24.8 $ FM-9 28.2
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