Value-Stream Costing Objective

During the week of June 12, Harrison Manufacturing produced and shipped 17,200 units of its aluminum wheels: 5,000 units of Model A and 12,200 units of Model B. The following costs were incurred:

	Materials		Salaries/ Wages		Machining		Other		Total Cost
Order processing			$19,600						$19,600
Production planning			188,400						188,400
Purchasing			25,200						25,200
Stamping	$370,000		37,000		$36,000		$18,200		461,200
Welding	150,000		42,000		12,000		246,000		600,000
Cladding	10,000								10,000
Testing			9,000						9,000
Packaging and shipping			9,000						9,000
Invoicing			12,600						12,600
Total	$1,120,000		$343,800		$78,000		$30,200		$1,572,000

Required:

1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost. $ per unit

2. Calculate the unit cost for Models A and B.

	Unit Cost
Model A	$
Model B	$

3. What if Model A is responsible for 40 percent of the materials cost? Calculate the unit materials cost for Models A and B.

	Unit Cost
Model A	$
Model B	$

Calculate the total unit cost for Models A and B.

	Unit Cost
Model A	$
Model B	$