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Dell Inc. produces two types of laptops, Inspiron and XPS. The following cost data is provided: Cost Item Inspiron XPS Direct Material $400/unit $700/unit Direct
Dell Inc. produces two types of laptops, Inspiron and XPS. The following cost data is provided:
Cost Item | Inspiron | XPS |
Direct Material | $400/unit | $700/unit |
Direct Labor | $150/unit | $250/unit |
Overhead | 150% of direct labor cost | 140% of direct labor cost |
Additional Information:
- Production for Inspiron: 50,000 units
- Production for XPS: 30,000 units
Requirements:
- Calculate the total cost for Inspiron and XPS.
- Determine the cost per unit for each laptop.
- Prepare a cost sheet for both laptops.
- Compare the cost structures and suggest which laptop is more cost-effective.
- Recommend pricing strategies based on cost analysis and competitive positioning.
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