Data table Manufacturing Overhead Costs per Unit: Standard Deluxe ABC costs ................. $ 258.50 8 431.50 Plantwide overhead rate ...... $ 310.50 8 3?9.50 The following data are budgeted for the company's Standard and Deluxe models for next year: Standard Deluxe Sales price per wheel ........ $ 430.00 $ 600.00 Direct materials per wheel . . . . $ 34.50 $ 47.75 Direct labor per wheel ........ $ 45.60 $ 53.00 -m Requirement 1. Compute the gross prot per wheel if managers rely on the ABC unit cost data. (Enter amounts to two decimal places.) Begin by computing the total manufacturing cost per wheel for each wheel model. King Corporation Total cost per unit using ABC data Standard Deluxe Total manufacturing cost Now compute the gross profit per wheel for each wheel model. Now compute the gross profit per wheel for each wheel model. King Corporation Gross profit per unit using ABC data Standard Deluxe Gross prot Requirement 2. Compute the gross prot per wheel if the managers rely on the plantwide allocation cost data. Begin by computing the total manufacturing costs. (Enter amounts to two decimal places.) King Corporation Total cost per unit using plantwide overhead rate Standard Deluxe Total manufacturing cost Now compute the gross profit per wheel for each wheel model if the managers rely on the plantwide allocation cost data. {Enter amounts to two decimal places.) King Corporation Gross profit per unit using plantwide overhead rate Standard Deluxe | :l Requirement 3. Which product line is more profitable for the company? Using the new ABC system, the standard model is Y the deluxe model. Activity-based costing data generally are Y cost data generated by a plantwide overhead allocation rate. ABC systems have V cost categories (activities). each with its own allocation base. ABC cost assignments Y represent the cost of resources consumed to manufacture (and support) products. Requirement 4. Why might the controller have expected ABC to pass the cost-benefit test? Were there any warning signs that the company's old direct-labor-based allocation system was broken? The ABC system is likely to pass the cost-benet test because King Corporation manufactures Y . The old cost system appears "broken" because prots have been declining even though the company V