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Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production Information follows: Home Direct materials cost per unit Direct
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production Information follows: Home Direct materials cost per unit Direct labor cost per unit Sales price per unit Expected production per month $ 43 18 Work $ 63 34 350 566 730 units 330 units Harbour has monthly overhead of $169,200, which is divided into the following cost pools: Setup costs Quality control Maintenance Total $ 72,900 65,100 31,200 $169,200 The company has also compiled the following information about the chosen cost drivers: Number of setups Hone 37 Work 53 Total Number of inspections Number of machine hours 330 1,600 370 1,000 90 700 2,600 Required: 1. Suppose Harbour uses a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount.) Home Model: Work Model: Overhead Assigned Total Overhead Cost S 0 2. Calculate the production cost per unit for each of Harbour's products under a traditional costing system. (Round your Intermediate calculations and final answers to 2 decimal places.) Unit Cost Home Work 3. Calculate Harbour's gross margin per unit for each product under the traditional costing system. (Round your intermediate calculations and final answers to 2 decimal places.) Home Work Gross Margin 4. Select the appropriate cost driver for each cost pool and calculate the activity rates if Harbour wanted to Implement an ABC system.
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