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Perdon Corporation manufactures safes-large mobile safes, and large walk-in stationary bank safes. As part of its annual budgeting process, Perdon is analyzing the profitability of
Perdon Corporation manufactures safes-large mobile safes, and large walk-in stationary bank safes. As part of its annual budgeting process, Perdon is analyzing the profitability of its two products. Part of this analysis involves estimating the amount of overhead to be allocated to each product line. The information shown below relates to overhead. Units planned for production Material moves per product line Purchase orders per product line Direct labor hours per product line Mobile Safes 200 300 450 800 Walk-in Safes 55 270 350 1,710 The total estimated manufacturing overhead of $261,000 was comprised of $163,000 for materials handling costs and $98,000 for purchasing activity costs. Under activity-based costing (ABC): (Round answers to 2 decimal places, e.g. 12.25.) What amount of purchasing activity costs are assigned to: (a) One mobile safe 275.63 per unit (b) One walk-in safe 1002.27|per unit LINK TO TEXT Your answer is partially correct. Try again. Compare the amount of overhead allocated to one mobile safe and to one walk-in safe under the traditional costing approach versus under ABC. (Round answers to 2 decimal places, e.g. 12.25.) Traditional Costing Activity-Based Costing 1 Mobile safe 415.94 704.58 Walk-in safe 3232.96 2406.1
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