Product costs and product profitability reports, using a single plantwide factory overhead rate Kao Engines Inc. produces three products-pistons, valves, and cams-for the heavy equipment industry. Kao Engines' production process uses a single plantwide factory overhead rate based upon direct labor hours to allocate overhead to the three products. The three products for 2012 are as follows: Budgeted Volume (Units) Direct Labor Hours Per Unit Price Per Selling Price Unit Per Unit Pistons Valves 7,500 16,000 0.40 0.50 $12 $40 6 75 Cams 4,000 0.20 201 60 The estimated direct labor rate is $25 per direct labor hour. Beginning and ending inventories are negligible and are, thus, assumed to be zero. The budgeted factory overhead for Kao Engines is $377,600. If required, round all per unit answers to the nearest cent. a. Determine the plantwide factory overhead rate. per dih b. Determine the factory overhead and direct labor cost per unit for each product. Direct Labor Direct Labor Factory Overhead Hours Per Unit Cost Per Unit Cost Per Unit Pistons dih Valves dth Alh Cams dlh. c. Use the information provided to construct a budgeted gross profit report by product line for the year ended December 31, 2012. Include the gross profit as a percent of sales in the last line of your report, rounded to one decimal place. Kao Engines Inc. Product Line Budgeted Gross Profit Reports For the Year Ended December 31, 20Y2 Description: Product Costs Pistons Valves Cams Total product costs Gross profit Gross profit percentage of sales d. What does the report in (c) indicate to you? Pistons have the gross profit as a percent of sales. Pistons may require a cost to manufacture in order to achieve a higher profitability similar to the other two products. price or