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Stillicum Corporation makes ultra light-weight backpacking tents. Data concerning the company's two product lines appear below: Deluxe Standard Direct materials per unit $ 65.00 $
Stillicum Corporation makes ultra light-weight backpacking tents. Data concerning the company's two product lines appear below: Deluxe Standard Direct materials per unit $ 65.00 $ 53.00 Direct labor per unit $ 23.00 18.80 Direct labor-hours per unit 0. 70 DLHS 1. 40 DLHS Estimated annual production 10, 000 units 50, 060 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 $651, 600 Estimated total direct labor-hours 77,080 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 Standard Total Supporting direct labor (direct labor-hours) $462, 000 7,000 70, 000 77,000 Batch setups (setups) 123,000 200 100 Safety testing (tests) 66, 000 30 70 109 Total manufacturing overhead cost $651, 000 Determine the unit product costs of the Deluxe and Standard products under the activity-based absorption costing system. Complete this question by entering your answers in the tabs below
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