Exercise 4-10 Contrasting ABC and Conventional Product Costs (L04-2, LO4-3, L04-4) Rocky Mountain Corporation makes two types of hiking boots-Xactive and Pathbreaker. Data concerning these two product lines appear below: Direct materials per unit Direct labor cost per unit Direct labor-hours per unit Estimated annual production and sales Xactive $ 65.50 $ 18.90 1.4 DLES 32,000 units Pathbreaker $ 51.70 $ 13.70 1 DIRA 82,000 units The company has a conventional 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 $2.624,760 126,800 DLHS Required: 1-a. Compute the predetermined overhead rate based on direct lobor-hours. 1-b. Using the predetermined overhead rate and other data from the problem, determine the unit product cost of each product. 2. The company is considering replacing its conventional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools: Activity Coat Pools and activity Measures Supporting direct labor (direct labor-hours) Dateh setupa (setups) Product sustaining (number of products) General factory (machine-hours) Total manufacturing overhead cont Estimated Overhead Coat $ 963,680 963,500 610,940 86,640 $2,624,760 Expected Activity Xactive Pathbreaker Total 44.800 92,000 126,800 285 185 470 1 1 2 3,200 8,200 11.400 Determine the activity rate for each of the four activity cost pools 3. Using the activity rates and other data from the problem, determine the unit product cost of each product. Required: 1-a. Compute the predetermined overhead rate based on direct labor-hours. 1-b. Using the predetermined overhead rate and other data from the problem, determine the unit product cost of each product. 2. The company is considering replacing its conventional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools: Activity Coat Pools and Activity Measures Supporting direct Inbor (direct labor-hours) Batch setups (setups) Product sustaining (number of products) General factory (machine-hours) Total manufacturing overhead cont Estimated Overhead Cont $.963,680 963,500 610,940 86,640 $2,624,760 Expected Activity Xactive Pathbreaker Total 44,800 82,000 126,800 285 185 470 1 1 2 3,200 8, 200 11,400 Determine the activity rate for each of the four activity cost pools. 3. Using the activity rates and other data from the problem, determine the unit product cost of each product. ces Complete this question by entering your answers in the tabs below. Req 1A Reg 10 Reg 2 Req3 Using the predetermined overhead rate and other data from the problem, determine the unit product cost of each product. (Round your intermediate calculations and final answers to 2 decimal places.) Urit product cost Xactive Wathbreaker $ 123.60 $ 82.11
