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Rondeau, Incorporated, manufactures and sells two products: Product V9 and Product M6. Data concerning the expected production of each product and the expected total
Rondeau, Incorporated, manufactures and sells two products: Product V9 and Product M6. Data concerning the expected production of each product and the expected total direct labor-hours (DLHS) required to produce that output appear below: Product V9 Product M6 Total direct labor-hours Expected Production 700 800 Direct Labor-Hours Per Unit 13.01 10.0 Total Direct Labor-Hours 9,100 8,000 17,100 The direct labor rate is $27.80 per DLH. The direct materials cost per unit for each product is given below: Product V9 Product M6 Direct Materials Cost per Unit $ 293.60 $ 186.80 The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity. Activity Cost Pools Activity Measures Labor-related Product testing Order size DLHs Tests MHs Required: Estimated Overhead Cost $ 104,656 77,608 404,000 $ 586,264 Expected Activity Product V9 Product M6 Total 9,100 8,000 17,100 1,200 5,900 1,600 2,800 5,200 11,100 Calculate the difference between the unit product costs under the traditional costing method and the activity-based costing system for each of the two products. (Round your intermediate calculations and final answers to 2 decimal places. Enter your answers as positive values.) Traditional unit product cost ABC unit product cost Difference Product V9 Product M6 $ 0.00 $ 0.00
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