ONLY NEED B AND C
y-basce LOG IN Douxtown Products manufactures fishing equipment for recreational wes The Miramichi plant produces the company's two versions of a special tool used for river fishing. The two models are the M-008, a basic reel, and the M-123, a new and improved version. Cost accoun tants at company headquarters have prepared costs for the two role for the most recent period. The plant manager is concerned. The cost report does not coincide with her intuition about the relative costs of the two modelsShe has asked you to review the cost accounting and help her prepare a response to headquarters Manufacturing overhead is currently assigned to products based on their direct labor costs. For the most recent month, manufacturing overhead was $280,000. During that time, the company produced 12,000 units of the M-008 and 2.000 units of the M-123. The direct costs of production were as follows: M-008 $100,000 100,000 M-123 $80,000 40.000 Total $180,000 140.000 Direct materials Direct labor . Management determined that overhead costs are caused by three cost drivers. These driv- ers and their costs for last year were as follows: Total Oost Driver Number of machine-hours Number of production uns... Number of inspections....... Total overhead Costs $120.000 70,000 90,000 $280.000 Activity Love M-008 M-123 5.000 3.000 10 10 20 40 8,000 20 00 Required a How much overhead will be aimed to each product these three cost drivers are used to allocate overhead? What is the total cost per unit produced for each product? allocate overhead? What is the total cost per unit produced for each product How much of the overhead will be assigned to cach product if direct labor cost is good to c Draft a memo for the plant manager explaining why the two systems oralt in different costs along with your recommendation for which conting system to use