Product Costs and Product Profitability Reports, using a Single Plantwide Factory Overhead Rate Elliott Engines Inc. produces three products-pistons, valves, and cams-for the heavy equipment industry. Elliott Engines has a very simple production process and product line and uses a single plantwide factory overhead rate to allocate overhead to the three products. The factorry overhead rate is based on direct labor hours. Information about the three products for 20Y2 is as follows: Direct Direct Budgeted Price Labor ale .. Hours Per Per Unit (Units) Unit Unit Pistons 12,000 0.20 $51 t25 26.000 Valves 0.15 13 4 2,000 Cams 0.30 68 29 be zero. The budgeted factory overhead for Elliott Engines is $213,900. The estimated direct labor rate is $29 per direct labor hour. Beginning and ending inventories are negligible and are, thus, assumed If required, round all per unit answers to the nearest cent. a. Determine the plantwide factory overhead rate. 31 per dlh b. Determine the factory overhead and direct labor cost per unit for each product. Direct Labor Factory Overhead Direct Labor ours Per Cost Per Unit Cost Per Unit Unit 5.80 s 6.20 0.20 dlh Pistons 4.65 $4.35 Valves 0.15 dh 0.30 dlh s9.30 Cams 8.70 Feedback Check My Work c. Use the information above to construct a budgeted gross profit report by product line for the year ended December 31, 20Y2. Include the gross profit as percent of sales in the last line of your report, rounded to one decimal place. Enter all amounts as positive numbers, except for a negative gross profit/gross profit percentage of sales. Elliot Engines Inc Product Line Budgeted Gross Profit Reports For the Year Ended December 31 Cams 612.000 338.000 136.000 Revenues Product Casts Direct materials s 104.000 S 300,000 58.000 Direct labor 69.600 113.100 17,400 Factory overhead 74400 120,900 18.600 Total Product Costs 444 000 338.000 94.000 s 168.000 0 42.000 Gross profit 30,9 % 27.5% Gross profit percentage sales d. What does the report (c) indicate ? Valves have the lowest aross profit as a percent sales, Valves may require higher lower cost to manufacture in order co achieve the same profitability as the other two products. price