Stoneham Manufacturing estimated its product costs and volume of production for Year 3 by quarter as follows. First Quarter $ 96,000 57,600 48,000 $ 201,600 Second Quarter $ 48,000 28,800 100,800 $ 177,600 8,000 Third Quarter $ 144,000 86,400 172,800 $ 403,200 24,000 16,000 Direct raw materials Direct labor Manufacturing overhead Total production costs Expected units produced Fourth Quarter $ 72,000 43,200 86,400 $ 201,600 12,000 Stoneham Company sells a souvenir item at various resorts across the country. Its management uses the product's estimated quarterly cost to determine the selling price of its product. The company expects a large variance in demand for the product between quarters due to its seasonal nature. The company does not expect overhead costs, which are predominately fixed, to vary significantly as to production volume or with amounts for previous years. Prices are established by using a cost-plus pricing strategy. The company finds variations in short-term unit cost confusing to use. Unit cost variations complicate pricing decisions and many other decisions for which cost is a consideration. Required a. Based on estimated total production cost, determine the expected quarterly cost per unit for Stoneham's product. b-1. Calculate the predetermined overhead rate. b-2. Calculate the unit cost per quarter based on the predetermined overhead rate.

Stoneham Manufacturing estimated its product costs and volume of production for Year 3 by quarter as follows. Stoneham Company sells a souvenir item at various resorts actoss the country. its management uses the product's estimated quarterly cost to determine the selling price of its product. The company expects a large varlance in demand for the product between quarters due to its seasonal nature. The company does not expect overhead costs, which are predominately flxed, to vary significantly as to production volume or with amounts for previous years. Prices are established by using a cost-plus pricing strategy the company finds variations in short-term unit cost confusing to use. Unit cost variations complicate pricing decisions and many other decisions for which cost is a consideration. Required a. Based on estimated total production cost, determine the expected quarterly cost per unit for Stoneham's product b-1. Calculate the predetermined overhead rate. b-2. Calculate the unit cost per quarter based on the predetermined overhead rate