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Hakara Company has been using direct labor costs as the basis for assigning overhead to its many products. Under this allocation system, product A has
Hakara Company has been using direct labor costs as the basis for assigning overhead to its many products. Under this allocation system, product A has been assigned overhead of $23.76 per unit, while product has been assigned $972 per unit Management feels that an ABC system will provide a more accurate allocation of the overhead costs and has collected the following cost pool and cost driver information Activity Driver Cost Pools Activity Cost Cost Drivers Consumption Machine setup $ 248,000 Setup hours 4,000 Material handling 162,000 23.000 23,000 Electric power 11,000 Pounds of material Kilowatt-hours The following cost information pertains to the production of A and B.just two of Hakara's many products: A 5,000 $ 23,000 $ 31,000 100 2.00 Number of units produced Direct materials cast Direct labor cost Number of setup hours Pounds of materials used Kilowatt hours 10.000 $22.000 $ 25,000 200 2.000 4. NN 2. ONO Required: 1. Use activity-based costing to determine a unit cost for each product (Round your final answers to 2 decimal places) Cost per Unit Product A Product B Next > of 7
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