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The following data are for the two products produced by Tadros Company. Direct materials Direct labor hours Machine hours Batches Volume Number of customers
The following data are for the two products produced by Tadros Company. Direct materials Direct labor hours Machine hours Batches Volume Number of customers Market price Product A $20 per unit 0.5 DLH per unit 0.4 MH per unit 200 batches 16,000 units 20 modifications 800 customers Product B $25 per unit 1.5 DLH per unit 1.2 MH per unit 360 batches 3,600 units 80 modifications 720 customers Engineering modifications $60 per unit $240 per unit The company's direct labor rate is $20 per direct labor hour (DLH). Additional information follows. Indirect manufacturing Engineering support Electricity Setup costs Nonmanufacturing Customer service Costs Driver $ 53,600 Engineering modifications 53,600 Machine hours 160,800 Batches 129,200 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. Compute the manufacturing cost per unit using the plantwide overhead rate based on direct lal Overhead costs $ Direct labor hours Overhead Assigned Product A Product B 268,000 $ 20.00 per direct labor hour 13,400 Activity Driver Plantwide OH rate Total Overhead Cost 8,000 $ 20.00 $ 160,000 5,400 $ 20.00 $ 108,000 Total manufacturing cost per unit: Total manufacturing cost 1.2 What is the gross profit per unit? Market price Manufacturing cost per unit Gross profit per unit Product A Product B 20.00 $ 25.00 16.00 48.00 LA $ 36.00 $ 73.00 Product A Product B $ 60.00 $ 240.00 $ (36.00) 24.00 $ (73.00) 167.00 2.1 How much gross profit is generated by each customer of Product A and Product B using the Product A Product B Gross profit per unit $ 24.00 $ 167.00 Units purchased per customer 2 5 Gross profit per customer $ 48.00 $ 835.00 2.2 What is the cost of providing customer service to each customer? 0 2.2 What is the cost of providing customer service to each customer? Is the gross profit adequate for each customer of Product A and B using the plantwide overhead r Product A Product B Gross profit per customer $ 48.00 $ 835.00 Customer service cost per customer Profit (loss) per customer Is the profit adequate? 3.1 Determine the manufacturing cost per unit of each product line using ABC. Engineering Support Electricity Setup Overhead Assigned Product A Engineering support Electricity Setup Product B Engineering support Electricity Setup of Activity Driver Activity r Engineering support Electricity Setup Total manufacturing costs Direct Materials per unit Book erences Direct Labor per unit Overhead per unit Total manufacturing cost per unit 3.2 What is the gross profit per unit? Market price Product A Product B Product A Product B (36.26) (101.63) 4.1 How much gross profit is generated by each customer of Product A and Product B using ABC Units purchased per customer Gross profit (loss) per customer Product A Product B 4.2 Is the gross profit adequate for each customer of Product A and B using ABC? Gross profit (loss) per customer Customer service cost per customer Profit (loss) per customer Product A Product B Is the profit adequate using ABC? 5. Which method of product costing gives better information to managers of this company? Method of product costing for better information
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