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Iontana Precision Products (MPP) produces parts for small machine tools. The typical product goes through two processes, machining nd finishing, before being packaged and shipped
Iontana Precision Products (MPP) produces parts for small machine tools. The typical product goes through two processes, machining nd finishing, before being packaged and shipped to the customer. All jobs at MMP are produced to order, and the company holds no nished goods inventory or work-in-process inventory. The company uses a traditional cost system and applies overhead to jobs ased on machine-hours. he plant manager and the plant controller have been discussing activity-based costing and the benefits of using it. The controller's taff have been collecting data on the plant costs and activities. Following are estimates of representative annual costs: The plant manager and the plant controlier decide to look at the difference in the unit costs using the two cost systems, by computing costs for three representative jobs completed in October. Data on those jobs follow: he plant controller has a completed a'tentative design for an ABC system to replace the current cost system. The system has five ctivities. Data on the activities and the annual volume for each of the cost drivers follow: What is the unit cost for each of the three jobs assuming Montana Precision Products continues to use its current costing system? Note: Round your final answers to 2 decimal places. 2. What is the unit cost for each of the three jobs assuming Montana Precision Products adopts the ABC system as designed by the plant controller? Note: Do not round intermediate calculations. Round your final answers to 2 decimal phaces
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