Question
The (M) signifies a manufactured part. The (P) signifies a purchased part. The cost of level 9 parts are assembled to make level 8 cost.
The (M) signifies a manufactured part. The (P) signifies a purchased part. The cost of level 9 parts are assembled to make level 8 cost. The level 8 costs are combined to make level 7. Levels 7 and 8 are manufactured parts. This is referred to as rolling the cost. You always start at the bottom and develop your cost to level 0. Once you reach level 0 costing for this product is complete.
Widget-Product Structure
Level Source Quantity Part Number Material Labor Overhead Total
0 M 1 01
1 M 1 A1
2 P 1 A2
2 P 1 A3
1 M 1 B1
2 P 1 B2
2 P 2 B3
1 M 1 C1
2 P 1 C2
2 P 2 C3
Part Number Unit Cost
A2 .35
A3 .40
B2 .20
B3 .30
C2 .15
C3 .25
Labor rate per hour is $15.00.
Assembly time from industrial engineering is .012 hours per assembly.
Factory overhead rate is 150% of labor cost.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started