Exercise 2A-3 Activity-Based Absorption Costing as an Alternative to Traditional Product Costing [LO2- 5) Stillicum Corporation makes ultra light-welght backpacking tents. Data concerning the company's two product lines appear below: Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production Deluxe $ 68.00 $ 26.ee 0.70 DLHS 10, eee units Standard $ 56.00 $ 21.20 1.40 DLHS 5e,eee units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $586,00 77,000 DLHS Required: 1. Determine the unit product costs of the Deluxe and Standard products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based absorption costing system that would have the following three activity cost pools: Expected Activity Activity Cost Pools and Activity Measures Supporting direct labor (direct labor-hours) Batch setups (setups) Safety testing (tests) Total manufacturing overhead cost Estimated Overhead Cost $ 385, eee 132,eee 69,00 $ 586, eee Deluxe 7,000 2ee 30 Standard 7e,eee 100 70 Total 77,000 300 100 Determine the unit product costs of the Deluxe and Standard products under the activity-based absorption costing system. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the unit product costs of the Deluxe and Standard products under the company's traditional costing system. (Round your intermediate calculations and final answers to 2 decimal places.) Deluxe Standard Unit product cost Exercise 2A-3 Activity-Based Absorption Costing as an Alternative to Traditional Product Costing (LO2- 5) Stillicum Corporation makes ultra light-weight backpacking tents. Data concerning the company's two product lines appear below: Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production Deluxe $ 68.00 $ 26.00 8.78 DLHS 10,000 units Standard $ 56.00 $ 21.20 1.40 DLHS 50,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $586,000 77,000 DLHS Required: 1. Determine the unit product costs of the Deluxe and Standard products under the company's traditional costing system. 2 The company is considering replacing its traditional costing system with an activity-based absorption costing system that would have the following three activity cost pools: Expected Activity Activity Cost Pools and Activity Measures Supporting direct labor (direct labor-hours) Batch setups (setups) Safety testing (tests) Total manufacturing overhead cost Estimated Overhead Cost $ 385,888 132, see 69, eee $ 586, cee Deluxe 7,eee 200 3e Standard 70,000 100 70 Total 77,eee 3ee 100 Determine the unit product costs of the Deluxe and Standard products under the activity-based absorption costing system. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Determine the unit product costs of the Deluxe and Standard products under the activity-based absorption costing system. (Round your intermediate calculations and final answers to 2 decimal places.) Deluxe Standard Unit product cost
