Question
Sanyo Company produces programmable and non-programmable calculators and operates at capacity. The following data are presented for your use: Programmable Non-programmable Annual production in units
Sanyo Company produces programmable and non-programmable calculators and operates at capacity. The following data are presented for your use: Programmable Non-programmable Annual production in units 50,000 100,000 Direct materials costs $ 150,000 $ 300,000 Direct manufacturing labor costs $ 50,000 $100,000 Direct manufacturing labor hours 2500 5000 Machine-hours 25,000 50,000 Number of production runs-set-ups 50 50 Inspection hours 1000 500 Manufacturing overheads are as follows: Overhead cost pool Total for both products Machining costs $ 375,000 Setup costs 120,000 Inspection costs 105,000 Required -Choose a cost driver for each overhead cost pool and calculate the manufacturing overhead cost per unit for each product. -Compute the manufacturing cost per unit for each product. -How does the activity based costing system help Sanyos managers to better manage their business.
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