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The accounting records for Portland Products report the following manufacturing costs for the past year. Direct materials $ 320,000 Direct labor 267,000 Variable overhead 237,000

The accounting records for Portland Products report the following manufacturing costs for the past year.

Direct materials $ 320,000

Direct labor 267,000

Variable overhead 237,000

Production was 140,000 units. Fixed manufacturing overhead was $774,000. For the coming year, costs are expected to increase as follows: direct materials costs by 20 percent, excluding any effect of volume changes; direct labor by 4 percent; and fixed manufacturing overhead by 10 percent. Variable manufacturing overhead per unit is expected to remain the same.

Required: a. Prepare a cost estimate for a volume level of 112,000 units of product this year.

b. Determine the costs per unit for last year and for this year.

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