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Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow: Direct Labor-Hours per unit Annual Production Rims 0.40 26,000
Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow: Direct Labor-Hours per unit Annual Production Rims 0.40 26,000 units Posts 0.60 88,000 units Additional information about the company follows: Rims require $20 in direct materials per unit, and Posts require $18. The direct labor wage rate is $18 per hour. Rims are more complex to manufacture than Posts and they require special equipment. The ABC system has the following activity cost pools: Activity Cost Pool Activity Measure Estimated Activity Estimated Overhead Cost Rims Posts Total Machine setups Number of setups $ 28,160 110 90 200 Special processing Machine-hours $ 164,560 2,000 0 2,000 General factory Direct labor-hours $ 780,000 10,400 52,800 63,200 1. Determine the unit product cost of each product according to the ABC system
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