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Rondeau, Inc., manufactures and sells two products: Product V9 and Product M6. Data concerning the expected production of each product and the expected total direct
Rondeau, Inc., manufactures and sells two products: Product V9 and Product M6. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Expected Production 580 680 Direct Labor- Hours Per Unit 11.8 8.8 Product V9 Product M6 Total direct labor-hours Total Direct Labor-Hours 6,844 5,984 12,828 The direct labor rate is $26.60 per DLH. The direct materials cost per unit for each product is given below: Direct Materials Cost per Unit $287.60 $180.80 Product V9 Product M6 The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Activity Cost Pools Labor-related Product testing Order size Activity Measures DLHS Tests MHS Estimated Overhead Cost $101,656 75,208 398,000 $574,864 Expected Activity Product Product V9 M6 Total 6,844 5,984 12,828 1,020 1,360 2,380 5,300 4,720 10,020 Required: Calculate the difference between the unit product costs under the traditional costing method and the activity-based costing system for each of the two products. (Round your intermediate calculations and final answers to 2 decimal places. Enter your answers as positive values.) Product V9 Product M6 Traditional unit product cost ABC unit product cost Difference $ 0.00 $ 0.00
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