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Kindness Corp. manufactures 2 products: (1) Product A and (2Product B and uses the Activity Based Costing (ABC) system. Data for the products is as
Kindness Corp. manufactures 2 products: (1) Product A and (2Product B and uses the Activity Based Costing (ABC) system. Data for the products is as follows: DL Hours per unit Annual Production Product Product A 0.5 25,000 Products 0.4 30,000 Additional Information A Product Arequires $16 in direct materials per unit and Product requires $12. B. The Direct Labor wage rate is $18 per hour. C. The ABC system has the following Activity cost pools: Activity Usage Est. Overhead Cost Product Product B Activity Cost Pool Activity Measure Total Machine Setups Number of Setups $30,000 110 90 200 Special Processing Machine Hours $250,000 3,000 2,000 5,000 General Factory Direct Labor Hours $320,000 12,000 8,000 20,000 1. Compute the Activity Rate for each activity cost pool 2. Compute the total overhead cost for product based on ABC. 3. Determine the unit cost of product Busing the ABC System, including Direct Materials and Direct Labor. For the multiple choice options, what is the total unit cost for Product B including Direct Materials and Direct Labor? O A $27.25 B. $25.00 O C. $19.20 OD. 39.34
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