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Required information [The following information applies to the questions displayed below.] Tent Master produces Pup tents and Pop-up tents. The company budgets $330,000 of
Required information [The following information applies to the questions displayed below.] Tent Master produces Pup tents and Pop-up tents. The company budgets $330,000 of overhead cost and 55,000 direct labor hours. Additional information follows. Per Unit Selling Price Direct Materials Direct Labor Pup tent Pop-up tent $ 90 85 $23 $50 27 32 Budgeted Activity Assembly Electricity Materials purchasing 73,000 Total $330,000 ces Budgeted Cost $220,000 37,000 Activity Cost Driver Direct labor hours (DLH) Machine hours (MH) Purchase orders (PO) Activity Usage 55,000 10,000 500 Required: 1. Compute an activity rate for each activity using activity-based costing. 2. The following actual activity usage produced 10,000 Pup tents and 6,000 Pop-up tents. Allocate overhead cost to Pup tents and to Pop-up tents and compute overhead cost per unit for each product. Activity Cost Driver Direct labor hours (DLH) Activity Usage Pup tents 36,500 Pop-up tents 18,500 4,000 6,000 150 Machine hours (MH) Purchase orders (PO) 350 3. Compute product cost per unit for Pup tents and for Pop-up tents. 4. For each product, compute the gross profit per unit (selling price per unit minus the product cost per unit).
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