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Question 2 Cheyenne Company uses an activity-based costing system. Consider the following information: Manufacturing Activity Area Machine setup Material handling Milling Assembly Cost Driver Used
Question 2 Cheyenne Company uses an activity-based costing system. Consider the following information: Manufacturing Activity Area Machine setup Material handling Milling Assembly Cost Driver Used as Application Base Number of setups Number of parts Machine hours Direct labour hours Cost per Unit of Conversion Application Base $192 $15 $53 $22 During the past month, 64 units of a component were produced. 3 setups were required. Each unit needs 30 parts, 5 direct labour hours, and 6 machine hours. Direct materials cost $124 per finished unit. All other costs are classified as conversion costs. If the company would like its gross margin to be 38% of sales, what price should it charge per unit of the component? (Round entry to whole amount, e.g. 5,725.) Price per unit
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