Knowledge Check Bluebean Inc. produces two lines of coffee cups: espresso coffee cups and travel coffee mugs. The unit cost information is shown here. The company uses a traditional volume-based costing system and believes that the number of labor hours is the appropriate cost driver. Activity Cost Pool Selling price Direct materials Direct labor Espresso Coffee Cups S 20 S 6 S 2 Travel Coffee Mugs $ 25 S 8 S 5 Units produced Direct labor hours 10,000 units 10,000 hours 4,000 units 6,000 hours Estimated total overhead costs $ 80,000 Espresso Coffee Cups Travel Coffee Mugs Item #1 Predetermined overhead rate Item #2 - Total manufacturing overhead allocated Item #3 - Manufacturing cost per unit Item #4 - Gross profit per unit $20 per direct labor hour $5 per direct labor hour $8 per direct labor hour Knowledge Check Bluebean Inc. produces two lines of coffee cups: espresso coffee cups and travel coffee mugs. The unit cost information is shown here. The company uses a traditional volume-based costing system and believes that the number of labor hours is the appropriate cost driver. Activity Cost Pool Selling price Direct materials Direct labor Espresso Coffee Cups S 20 S 6 S 2 Travel Coffee Mugs $ 25 S 8 $ 5 Units produced Direct labor hours 10,000 units 10,000 hours 4,000 units 6,000 hours Estimated total overhead costs $ 80,000 Espresso Coffee Cups Travel Coffee Mugs Item #1 - Predetermined overhead rate Item #2 - Total manufacturing overhead allocated Item #3 - Manufacturing cost per unit Item #4 - Gross profit per unit $5 per direct labor hour $13 per direct labor hour $25 per direct labor hour