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

Activity Cost Allocation Base

Setup $60,000 Number of setups

Machine maintenance 40,000 Number of machine hours

Total direct manufacturing cost $100,000

Rum Baileys Total

Direct labor hours 1,200 3,800 5,000

Number of setups 40 40 80

Number of machine hours 3,000 2,000 5,000

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.