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G H Wess company has limited capacity and can produce either its standard product or its deluxe product. Additional information follows. 3 Per Unit Selling

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G H Wess company has limited capacity and can produce either its standard product or its deluxe product. Additional information follows. 3 Per Unit Selling price Direct materials Direct labor Standard $60 30 20 Deluxe $90 35 25 Required: 1. Using a single plantwide rate, the company computes overhead cost per unit of $15 for the standard model and $20 for the deluxe model. Which model should the company produce? Hint: Compute product cost per unit and compare that with selling price to get gross profit per unit. Plantwide OH rate Standard OH Deluxe OH per Unit $15 $20 per Unit (Use cells AS to C8 from the given information to complete this question. A negative gross profit should be indicated with a minus sign) Product cost per unit: Direct materials Direct Labor Overhead Product Cost per unit Direct materials Direct Labor Overhead Product Cost per unit Product cost per unit: Standard Deluxe Selling price Product cost Gross profit Gross profit per unit: Standard Deluxe Which model should the company produce? 2. Using activity-based costing, the company computes overhead cost per unit of $s for the standard model and $40 for the deluxe model. Which model should the company produce? Hint: Compute product cost per unit and compare that with selling price per unit to get gross profit per unit. ABC rate Standard OH Deluxe OH per Unit per Unit $5 $40 (Use cells AS to CB from the given information to complete this question. A negative gross profit should be indicated with a minus sign) Product cost per unit: Standard Direct materials Direct Labor Overhead Product Cost per unit 2. Using activity based casting, the company computes overhead cost per unit of $5 for the standard model and so for the deluxe model. Which model should the company produce? Hint: Compute product cost per unit and compare that with selling price per unit to get gross profit per unit. ABC rate Standard OH Deluxe OH per Unit per Unit $5 $40 (Use cells AS to C from the given information to complete this question. A negative gross profit should be indicated with a minus sign.) Product cost per unit: Direct materials Direct Labor Overhead Product Cost per unit Standard Deluxe Selling price Product cost Gross profit Gross profit per unit: Standard Deluxe Which model should the company produce

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