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National Inc. manufactures two models of CMD that can be used as cell phones, MPX, and digital camcorders. Annual Sales Model High F Great
National Inc. manufactures two models of CMD that can be used as cell phones, MPX, and digital camcorders. Annual Sales Model High F Great P in Units 10,000 16,000 National uses a volume-based costing system to apply factory overhead based on direct labor dollars. The unit prime costs of each product were as follows: Direct materials High F Great P $38.00 $25.40 Direct labor $17.52 $13.14 Budget factory overhead: Engineering and Design Quality Control Machinery Miscellaneous Overhead Total 2,409 engineering hours 12,848 inspection hours 33,726 machine hours 26,400 direct labor hours. $ 404,712 269,808 539,616 134,904 $1,349,040 National's controller had been researching activity-based costing and decided to switch to it. A special study determined National's two products have the following budgeted activities: Engineering and design hours Quality control inspection hours Machine hours High F Great P 969 1,440 5,648 7,200 20,286 13,440 Labor hours 12,000 14,400 Using activity-based costing, applied machinery overhead for the Great P model per unit is: (Rounded to the nearest cent.)
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