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soultion for all these answers Bobcat Spirit produces two product lines: Polos and Half-Zips. Product profitability is analyzed as follows: Polos Half-Zips Production and sales
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Bobcat Spirit produces two product lines: Polos and Half-Zips. Product profitability is analyzed as follows: Polos Half-Zips Production and sales volume 50,000 units 25,000 units Selling price $20.00 $32.00 Direct material $1.75 $6.50 $6.80 Direct labor $4.50 Manufacturing overhead $3.25 $2.00 $11.75 Gross profit $15.45 Selling and administrative $5.10 $ 8.45 Operating profit $6.65 $ 7.00 Bobcat Spirit's managers have decided to revise their current assignment of overhead costs to reflect activity based costing information. Their overhead costs consist of $125,000 of preparation and $85,000 of packaging. The cost driver for preparation is direct labor hours and the cost driver for packaging is number of packages. They also provided additional information below: Activities demanded Polos Half-Zips 1.25 DLH/unit 1.75 DLH/unit 50,000 DLHS 45,000 DLHS 60.000 packages 20,000 packages Under the revised ABC System, total overhead costs allocated to polos will be Under the revised ABC System, overhead costs per unit for the Polo will be 2.59 2.77 2.64 2.00 Using an ABC System, next year's estimates show manufacturing overhead costs will total $135,000 for 60,000 Polos. If all other Polo costs and sales prices remain the same, what will the estimated profit per polo be? 6.40 6.65 06.06 6.20 Using an activity based costing system, compute the estimated operating profit per unit for the mahogany style desk $60.50 O $25.50 $42.50 $65.00 Step by Step Solution
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