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Space Antenna Corporation is currently using a single predetermined overhead rate based on direct labor hours to allocate manufacturing overhead to its two products: Lo-Gain
Space Antenna Corporation is currently using a single predetermined overhead rate based on direct labor hours to allocate manufacturing overhead to its two products: Lo-Gain antennas and Hi-Gain antennas for use in remote areas. The company is considering the use of activity-based costing (ABC). The following information is provided about the production of the two product lines: Activity Setup Machine maintenance Total manufacturing overhead costs Cost $51,000 39.000 Allocation Base Setups Machine Hours $90,000 Quantity per Product Line Lo-Gain Hi-Gain Direct labor hours 1.700 2.300 Setups 50 50 Machine hours 1,800 1.200 Space Antenna plans to produce 170 Lo-Gain antennas and 300 Hi-Gain antennas. The manufacturing overhead cost per unit of a Hi-Gain antenna, using ABC is closest to: $343.75 per unit $172.50 per unit $137.00 per unit $85,00 per unit tent
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