Stillicum Corporation makes ultra light-weight backpacking tents. Data concerning the company's two product lines appear below:...
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Stillicum Corporation makes ultra light-weight backpacking tents. Data concerning the company's two product lines appear below: Direct materials per unit Deluxe $ 53.00 Standard $ 41.00 Direct labor per unit $ 11.00 $ 9.20 Direct labor-hours per unit Estimated annual production 0.70 DLHS 10,000 units 1.40 DLHs 50,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $603,000 77,000 DLHS Required: 1. Determine the unit product costs of the Deluxe and Standard products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based absorption costing system that would have the following three activity cost pools: Expected Activity Estimated Overhead Activity Cost Pools (and Activity Measures) Cost Deluxe Supporting direct labor (direct labor-hours) Batch setups (setups) $462,000 Safety testing (tests) Total manufacturing overhead cost 87,000 54,000 $603,000 7,000 200 Standard 70,000 Total 77,000 100 300 30 70 100 Determine the unit product costs of the Deluxe and Standard products under the activity-based absorption costing system. Stillicum Corporation makes ultra light-weight backpacking tents. Data concerning the company's two product lines appear below: Direct materials per unit Deluxe $ 53.00 Standard $ 41.00 Direct labor per unit $ 11.00 $ 9.20 Direct labor-hours per unit Estimated annual production 0.70 DLHS 10,000 units 1.40 DLHs 50,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $603,000 77,000 DLHS Required: 1. Determine the unit product costs of the Deluxe and Standard products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based absorption costing system that would have the following three activity cost pools: Expected Activity Estimated Overhead Activity Cost Pools (and Activity Measures) Cost Deluxe Supporting direct labor (direct labor-hours) Batch setups (setups) $462,000 Safety testing (tests) Total manufacturing overhead cost 87,000 54,000 $603,000 7,000 200 Standard 70,000 Total 77,000 100 300 30 70 100 Determine the unit product costs of the Deluxe and Standard products under the activity-based absorption costing system.
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