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Sunland Electronics manufactures two ultra-high-definition television models: the Royale, which sells for $1,580, and a new model, the Majestic, which sells for $1,270. The production
Sunland Electronics manufactures two ultra-high-definition television models: the Royale, which sells for $1,580, and a new model, the Majestic, which sells for $1,270. The production cost computed per unit under traditional costing for each model in 2025 was as follows. Traditional Costing Direct materials Direct labor ($20 per hour) Manufacturing overhead ($40.265 per DLH) Total per unit cost Royale $660 120 242 $1,022 Majestic $410 100 201 $711 Sunland Electronics manufactures two ultra-high-definition television models: the Royale, which sells for $1,580, and a new model, the Majestic, which sells for $1,270. The production cost computed per unit under traditional costing for each model in 2025 was as follows: In 2025, Sunland manufactured 25,000 units of the Royale and 10,000 units of the Majestic. The overhoad rate of $40265 per direct labor hour was detemined by dividing total estimated manufacturing overhead of $8,052,900 by the total direct labor hours (200,000) for the two models. Under traditional costing, the mross proft on the models was Royale $558($1,580$1,022) and Majestic $559($1,270 - $711). Eecause of thir ditference, management is considering phasing out the Foyale model and increasing the production of the Majestic model. Before finaliting its decislon management asks Sunland's controller to prepare an analysls using activity-bascd costing (ABC). The controller aceumulates the following information about overhead for the year ended December 31, 2025. The cont drivers used for each product were: Assign the total 2025 manufacturing overhead costs to the two products using activity-based costing (ABC) and determine the overhead cost per unit. (Round cost per unit to 2 decimal places, e.g. 12.25.)
Sunland Electronics manufactures two ultra-high-definition television models: the Royale, which sells for $1,580, and a new model, the Majestic, which sells for $1,270. The production cost computed per unit under traditional costing for each model in 2025 was as follows. Traditional Costing Direct materials Direct labor ($20 per hour) Manufacturing overhead ($40.265 per DLH) Total per unit cost Royale $660 120 242 $1,022 Majestic $410 100 201 $711
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