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Thatcher Supply manufactures and sells two types of pet doors - Standard and H-Tech. The 5tardard model is a batic opening installed in a door.
Thatcher Supply manufactures and sells two types of pet doors - Standard and H-Tech. The 5tardard model is a batic opening installed in a door. The Hi-Tech model is automated and includes several safety features using eiectronics. The Hi-Toch model requires shorter production runs and more frequent inspection to ensure quality standards are met. In August, Thatcher Supply hod the folowing financial results: Other selected information for units produced in August follow: Thatcher Supply currently uses direct iabor-hours to allocate all overheadto the wo models but is considering implementing an activity based costing system. After interviewing the salos and production staff, the financlal stalf suggests they allocate. administrative costs on the basis of revenue. They would use the following cost ditvers to allocate the remaining three pools of overthead costs: Other selected information for units produced in August follow: Thatcher Supply currently uses direct labor-hours to allocate all overhead to the two models but is considering implementing an activity-bused costing system. After interviewing the sales and production staff, the financial staff suggests they allocate administrative costs on the basis of revenue. They would use the following cost drivers to allocate the remaing three pools of overhead costs: Required: a. Complete the product-line income statement using the current systemyising direct labor-hours to allocote overhead costs. b. Complete the product-line income statement using the proposed ABC'\$ystem to allocate overheed costs. Complete this question by entering your answers in the tabs below. Complete this question by entering your answers in the tabs below. Complete the product-line income statement using the current system using direct labor-hours to allocate overhead costs: Note: Do not round intermediate calculations. Input all amounts as positive values. Complete this question by entering your answers in the tabs below. Complete the product-line income statement using the proposed ABC system to allocate overhead casts. Note: Do not round intermediate calculations. Input all amounts as positive values
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