The following data are for the two products produced by Tadros Company.

	Product A			Product B
Direct materials	$	14 per unit		$	27 per unit
Direct labor hours		0.4 DLH per unit			1.6 DLH per unit
Machine hours		0.3 MH per unit			1.2 MH per unit
Batches		110 batches			220 batches
Volume		10,000 units			2,000 units
Engineering modifications		9 modifications			45 modifications
Number of customers		500 customers			400 customers
Market price	$	34 per unit		$	95 per unit per unit

The company's direct labor rate is $20 per direct labor hour (DLH). Additional information follows.

	Costs			Driver
Indirect manufacturing
Engineering support	$	22,000		Engineering modifications
Electricity		21,600		Machine hours
Setup costs		42,000		Batches
Nonmanufacturing
Customer service		73,000		Number of customers

Required: (Round your per unit cost answers to 2 decimal places and other answers to nearest whole number. Loss amounts should be indicated with minus sign.)

1.

1.2

2,1

2.2

3.1

3.2

4.1

4.2

5. Which method of product costing gives better information to managers of this company?

1. Compute the manufacturing cost per unit using the plantwide overhead rate based on direct labor hours. $ 11.89 per direct labor hour Overhead costs Number of modifications $ 85,600 7,200 Activity Overhead Assigned Driver Plantwide OH rate Total Overhead Cost Units Produced Product A Product B 4.000 ,200 $ $ 11.89 $ 11.89 $ 47,560 38,048 1000 - OH Cost per Unit $ 4.76 $ 19.02 10,000 ,000 3 2 5 Total manufacturing cost per unit: Direct material cost per unit Direct labor cost per unit Overhead cost per unit Product A 14.00 0.40 476 Product B 27.00 1.60 19.02 Total manufacturing cost 19.16 $ 47.62 hat ie the Arnec nonfit non init? 2.2 What is the cost of providing customer service to each customer? Number of customers $ 900 $ 0.01 per customer Customer service costs 73,000 Is the gross profit adequate for each customer of Product A and B using the plantwide overhead rate? Product A Product B Gross profit per customer 296.80 $ 236.90 Customer service cost per customer Profit (loss) per customer Is the profit adequate? Yes 3.1 Determine the manufacturing cost per unit of each product line using ABC. Engineering Support Number of modifications 0 per modification NO 5 Electricity 0 per machine hour Setup 0 per batch Overhead Assigned Activity Driver Activity rate Overhead Cost 9 DE SA LE Product A Engineering support Electricity Setup $ 0 4510 Product B Engineering support Electricity Setup 2250 Total manufacturing costs Product A Product B Product A Product B Total manufacturing costs Direct Materials per unit Direct Labor per unit Overhead per unit Total manufacturing cost per unit 3.2 What is the gross profit per unit? Product A Product B Market price (24.97) (86.97) 4.1 How much gross profit is generated by each customer of Product A and Product B using ABC? Product A Product B Units purchased per customer Gross profit (loss) per customer 4.2 Is the gross profit adequate for each customer of Product A and B using ABC? Direct labor cost per unit 0.40 1.60 Overhead cost per unit 4.76 19.02 Total manufacturing cost $ 19.16 $ 47.62 1.2 What is the gross profit per unit? Product A Product B Market price 34.00 $ 95.00 Manufacturing cost per unit (19.16) (47.62) Gross profit per unit 14.84 47.38 2.1 How much gross profit is generated by each customer of Product A and Product B using the plantwide overhea rate? Product A Product B Gross profit per unit 14 84 $ 47.38 Units purchased per customer Gross profit per customer 296.80 $ | 236.90 2.2 What is the cost of providing customer service to each customer? Number of customers $ 900 $ 0,01 per customer Customer service costs 73.000 20 le the nrnce nfit adenuata for each timering Product and Risina theantwde warhead rata2