Help please!
Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and the Pathfinder. Data concerning these two product lines appear below: Selling price per unit Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production and sales Xtreme $ 115.00 $ 63.90 $ 12.00 1.2 DLHS 28,000 units Pathfinder $ 85.00 $ 51.00 $ 10.00 1.0 DLHS 75,000 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 $ 2,063,400 108,600 DLHS Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and idle capacity costs): Activities and Activity Measures Supporting direct labor (direct labor-hours) Batch setups (setups ) Product sustaining (number of products) Other Total manufacturing overhead cost Estimated Expected Activity Overhead Cost Xtreme Pathfinder Total $ 673, 320 33,600 75,000 108,600 520,000 240 520 790,000 1 2 80,080 NA NA NA $ 2,063, 400 Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. (Round your intermediate calculations to 2 decimal places and final answers to the nearest whole dollar amount.) Xtreme | $ 456,400 Pathfinder $ 375,000 $ Total 831,400 Product margin Required 1 Required 2 > Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Compute the product margins for the Xtreme and the Pathfinder products under the activity-based costing system. (Round your intermediate calculations to 2 decimal places.) Product margin_ Xtreme $ 171,480 Pathfinder $ 660,000 $ Total 831,480 Total Xtreme - % of Amount Total Amount Pathfinder % of Amount Total Amount Amount $ Traditional Cost System Direct materials Direct labor Manufacturing overhead Total cost assigned to products 1,789,200 336,000 638,400 2,763,600 $ Total Xtreme % of Amount Total Amount Pathfinder - % of Amount Total Amount Amount Activity-Based Costing System Direct costs: Indirect costs: $ Total cost assigned to products Costs not assigned to products: Total cost
