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Johnson & Johnson produces two types of medical devices, Device A and Device B. The following cost data is available: Cost Item Device A Device
Johnson & Johnson produces two types of medical devices, Device A and Device B. The following cost data is available:
Cost Item | Device A | Device B |
Direct Material | $500/unit | $700/unit |
Direct Labor | $200/unit | $300/unit |
Overhead | 160% of direct labor cost | 140% of direct labor cost |
Additional Information:
- Production for Device A: 5,000 units
- Production for Device B: 3,000 units
Requirements:
- Calculate the total cost for Device A and Device B.
- Determine the cost per unit for each device.
- Prepare a cost sheet for both devices.
- Compare the cost structures and suggest which device is more profitable.
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