Question
Mahaley, Inc., manufactures and sells two products: Product Q9 and Product F0. Data concerning the expected production of each product and the expected total direct
Mahaley, Inc., manufactures and sells two products: Product Q9 and Product F0. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below:
Expected Production | Direct Labor-Hours Per Unit | Total Direct Labor-Hours | |
Product Q9 | 960 | 9.6 | 9,216 |
Product F0 | 960 | 7.6 | 7,296 |
Total direct labor-hours | 16,512 | ||
The direct labor rate is $23.40 per DLH. The direct materials cost per unit for each product is given below:
Direct Materials Cost per Unit | |||
Product Q9 | $176.50 | ||
Product F0 | $148.30 | ||
The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Estimated | Expected Activity | |||||
Activity Cost Pools | Activity Measures | Overhead Cost | Product Q9 | Product F0 | Total | |
Labor-related | DLHs | $ | 395,680 | 9,216 | 7,296 | 16,512 |
Machine setups | setups | 51,830 | 1,100 | 1,000 | 2,100 | |
Order size | MHs | 292,700 | 4,700 | 4,500 | 9,200 | |
$ | 740,210 | |||||
The unit product cost of Product F0 under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)
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