Problem 17-1A Comparing costs using ABC with the plantwide overhead rate Lo P1, P3, A 2 points The following data are for the two products produced by Tadros Company, Skipped Product A $15 per unit 0.4 DLH per unit 0.3 MH per unit 90 batches 10,000 unito 8 modifications 500 customers $35 per unit Direct materials Direct labor hours Machine hours Batches Volume Engineering modifications Number of customers Market price Product B $27 per unit 1.4 DTH per unit 1.0 MH per unit 180 batches 2,000 units 40 modifications 400 customers $120 per unit eBook The company's direct labor rate is $20 per direct labor hour (DLH), Additional Information follows. Indirect manufacturing Engineering support Electricity Setup costa Nonmanufacturing Customer service Costa Driver $25,500 Engineering modifications 20,000 Machine hours 42,000 Batches 71,000 Number of customers Required: 5 2 1. Compute the manufacturing cost per unit using the plantwide overhead rate based on direct labor hours. Overhead costs Direct labor hours Overhead Assigned Activity Driver Plantwide OH rate Total Overhead Cost Units Produced Product A Products OH Cost per unit soints Skipped eBook Product A Product B Print References 1.2 What is the gross profit per unit? Product A Product B Market price Gross profit per unit 2.1 How much as criticenerated by each customer of Product A and Product Busing the plantwide overhead rate? 5 2.1 How much gross profit is generated by each customer of Product A and Product B using the plantwide overhead rate? Product A Product B Gross profit per unit Units purchased per customer Gross profit per customer 2.2 What is the cost of providing customer service to each customer? Skipped Book Is the gross profit adequate for each customer of Product A and using the plantwide overhead rate? Product A Product Gross profit per customer Customer service cost per customer Profit (los) per customer Is the profit adequate? 2.1 Determine the manufacturing cost per unit of each product line using ABC Engineering Support Electricity Check my work 5 Electricity Setup Skipped Activity Driver Activity rate Total Overhead Cost Book Overhead Assigned Product Engineering support Electricity Setup References D Product B Engineering support Electricity Setup $ 0 Check my work 5 Product A Products Total manufacturing costs Direct Materials per unit Direct Labor per unit Overhead per unit Total manufacturing cost per unit 2. points 3.2 What is the gross profit per unit? Product A Product B Book Market price Print (26.03) (83.63) References 4.1 How much gross profit is generated by each customer of Product A and Product Busing ABC? Product A Product B Units purchased per customer Gross profit (s) per customer 4.2 is the gross profit adequate for each customer of Product A and using ABC? Product A Product Gross profit (los) per customer Customer service cost per customer 5 3.2 What is the gross profit per unit? Product A Product B Market price (28.03) (83.63) sints Suipped 4.1 How much gross profit is generated by each customer of Product A and Product Busing ABC? Product A Product B eBook Print References Units purchased per customer Gross profit (loss) per customer 4.2 is the gross profit adequate for each customer of Product A and B using ABC? Product A Product B Gross profit (loss) per customer Customer cost per customer Profit (los) per customer Is the profit adequate using ABC? 5. Which method of product costing gives better information to managers of this company? Method of product costing for better information
