Question
Two-Stage ABC for Manufacturing Assume Sherwin-Williams Company, a large paint manufacturer, has determined the following activity cost pools and cost driver levels for t Activity
Two-Stage ABC for Manufacturing Assume Sherwin-Williams Company, a large paint manufacturer, has determined the following activity cost pools and cost driver levels for t Activity Cost Pool Activity Cost Activity Cost Driver Machine setup $900,000 ME Material handling Machine operation The following data are for the production of single batches of two products, Mirlite and Subdue: Mirlite Subdue 60,000 25,000 2.500 setup hours 820,000 4,000 material moves 400,000 20,000 machine hours Gallons produced Direct labor hours 250 Machine hours 250 Direct labor costantemen $10,000 $7,500 Direct materials cost $360,000 $150,000 mmmmmmmmllimmmmmm Setup hours Material moves Direct materials Direct labor 400 800 Check Determine the batch and unit costs per gallon of Mirlite and Subdue using ABC. Round cost per gallon to two decimal places. Product Costs Manufacturing overhead: Machine setups Material handling Machine operation Total cost per batch Gallons produced Cost per gallon 15 60 5 12 35 Mirlite 1 Subdue
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