The following information is provided for Cruzan Rum,Corp. which manufactures two products: Rum and Baileys for use in the VI market.

ActivityCostAllocation Base

Setup$60,000Number of setups

Machine maintenance 40,000Number of machine hours

Total direct manufacturing cost$100,000

RumBaileysTotal

Direct labor hours1,2003,8005,000

Number of setups404080

Number of machine hours3,0002,0005,000

Cruzan Rum plans to provide 250 Rum and 450 Baileys

Requirements

1. Compute the indirect manufacturing costs per unit using direct labor hours to the single plantwide predetermined overhead allocation rate.

2. Compute ABC indirect manufacturing cost per unit for each product.