Direct labor hours for each product needed.

Pricing Strategy Using Different Costing Models A Two Wheels makes two different types of bicycles. One is a high quality racing bicycle, while the other is a high volume three speed bicycle. Management believes that profits can be achieved by its changing its pricing strategy. Two Wheels has traditionally determined the cost of its products by applying overhead based on direct labor hours, which is budgeted at 3,000 direct labor hours per month. The company's accountant gathered the following information to enable a comparison of the traditional approach to applying overhead with an activity based costing approach. Required: Assuming that Two Wheels sets the selling prices of its products at cost plus a markup of 110%, determine the cost per unit and the selling price of each bicycle using Traditional absorption costing based on direct labor hours. Activity based costing. Pricing Strategy Using Different Costing Models A Two Wheels makes two different types of bicycles. One is a high quality racing bicycle, while the other is a high volume three speed bicycle. Management believes that profits can be achieved by its changing its pricing strategy. Two Wheels has traditionally determined the cost of its products by applying overhead based on direct labor hours, which is budgeted at 3,000 direct labor hours per month. The company's accountant gathered the following information to enable a comparison of the traditional approach to applying overhead with an activity based costing approach. Required: Assuming that Two Wheels sets the selling prices of its products at cost plus a markup of 110%, determine the cost per unit and the selling price of each bicycle using Traditional absorption costing based on direct labor hours. Activity based costing