Value-Stream Costing Objective

During the week of June 12, Harrison Manufacturing produced and shipped 16,000 units of its aluminum wheels: 3,400 units of Model A and 12,600 units of Model B. The following costs were incurred:

	Materials		Salaries/ Wages		Machining		Other		Total Cost
Order processing			$19,400						$19,400
Production planning			34,800						34,800
Purchasing			23,400						23,400
Stamping	$380,000		38,000		$36,200		$18,000		472,200
Welding	160,000		20,000		16,000		12,000		208,000
Cladding	65,000								65,000
Testing			10,000						10,000
Packaging and shipping			10,000						10,000
Invoicing			14,200						14,200
Total	$605,000		$169,800		$52,200		$30,000		$857,000

Required:

Note: Round ALL interim calculations to two decimal places. Uses these values in subsequent computations.

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. Unit cost is $ 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	$