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Value-Stream Average Costing, DBC, ABC Costs as Benchmarks A value stream has three activities and two products. The units produced and shipped per week
Value-Stream Average Costing, DBC, ABC Costs as Benchmarks A value stream has three activities and two products. The units produced and shipped per week are 50 of the deluxe model (Model A) and 250 of the basic model (Model B). The cycle time for Model A is four hours and that of Model B is three hours. The resource consumption patterns are shown as follows: Model A Model B Costs of Value- Stream Activities Cell manufacturing 2,300 min. Engineering 70 hrs. 7,300 min. 270 hrs. $ 192,000 51,000 Testing 90 hrs. 190 hrs. 27,440 Total $ 270,440 Required: 1. Calculate the ABC product cost for Models A and B. If required, round your answers to the nearest cent. Product Cost Per Unit Model A $ Model B $ per unit per unit 2a. Calculate the value-stream average product cost. If required, round your answer to the nearest cent. $ per unit 2b. Assuming reasonable stability in the consumption patterns of the products and product mix, assess how well the products are grouped based on similarity. 3. Calculate the unit cost of each product using DBC. Round intermediate calculations and your answers to the nearest cent if rounding is required. Product Cost Per Unit Model A $ per unit Model B $ per unit
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