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Eason Company manufactures wheel rims. The company produces two wheel rim models: standard and deluxe. For 2 0 2 5 , Eason's managers have decided

Eason Company manufactures wheel rims. The company produces two wheel rim models: standard and deluxe. For 2025, Eason's managers have decided to use the same indirect manufacturing costs per wheel rim that they computed in 2024 using activity-based costing.
(Click the icon to view the 2024 indirect manufacturing costs per wheel rim.)
\table[[ABC Data Gross Profits],[,Standard,Deluxe],[Sales price,$,800.00,$,940.00],[Direct materials,,31.00,,48.00],[Direct labor,,45.00,,52.00],[Indirect manufacturing costs,,224.40,,719.40],[Gross profit per unit,$,499.60,$,120.60]]
In addition to the unit indirect manufacturing costs, the following data are expected for the company's standard and deluxe models for 2025 :
(Click the icon to view the expected information.)
Because of limited machine hour capacity, Eason can produce either 2,000 standard rims or 2,000 deluxe rims.
Read the requirements.
Data table
\table[[Indirect Manufacturing Cost Per Unit],[of,,ndard,Deluxe],[ABC costs,$,224.40$,719.40],[Single-rate costs,$,429.00S,514.80]]
Eason's managers will produce 2000 units of the Standard model to maximize income.
Requirement 2. If the managers rely on the single plantwide overhead allocation rate cost data, which model will they produce?
Use the single plantwide allocation rate cost data to compute the gross profit per unit for each model. (Round amounts to the nearest cent, $x.x
\table[[Single-Allocation-Base Data Gross Profits,],[Sales price,],[Standard,],[Direct materials,]]
Data table
\table[[-,,ndard,Deluxe],[Sales price,$,800.00$,940.00],[Direct materials,,31.00,48.00],[Direct labor,,45.00,52.00]]
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