Vulcan Company manufacture costing system assigning product is more complex to pro compared to one hour of direct labor time Consumers, this results ompany manufactures two products. Currently, the company uses a traditional y system assigning overhead on the basis of direct labor hours. The Industrial Is more complex to produce requiring two hours of direct labor time per unit To one hour of direct labor time for the Consumer product. Given the company's Total overhead costs of $360,000 and production of 1,000 Industri $360,000 and production of 1,000 Industrials and 8,000 hers, This results in an overhead allocation rate of $36 per direct labor hour. The following unit data are provided: Industrial Consumer 5720.00 $360.00 Direct material (250.00) (125.00) Direct labor (200.00) (10000) Overhead ( 72.00 __636.00 Gross profit $198.00 $99.00 Selling price Because the Industrial product is twice as profitable as the Consumer model, the sales manager wants to reduce or eliminate production of the Consumer product and devote as much capacity as possible to the Industrial product. you are worried that the current cost accounting system may be providing inaccurate results and would like to implement an ABC system. Assume that the company's overhead costs were traced to four major activities. The amount of overhead costs traceable to each activity for the current year is provided below: Cost Driver Data Overhead Activity C'est Driver Costs Industrial Consunet Total Matenal No. of purchase 100 handling Orders Setup No. of setups 144,000 250 750 Assembly No. of machine hours 112.500 3.000 10.000 Maintenance No. of maintenance 73.500 295 735 requests Total $360.000 $ 30,000 500 IT of overhead cost which should be assigned to Industrials and activity-based costing. Also compute the overhead cost per unit for Compute the amount o Consumers under activity-based each product. ACTIVITY Matenal handling Setup Assembly Maintenance Total overhead cost 1000 Industrials 8000 Contes Divide by number of units Overhead cost per unit pute the total cost to manufacture one unit of each product if activity-based costing is used. Direct material Industials Consumers Direct labor $250.00 $125.00 $200.00 $100.00 Overhead Total Cost per unit Respond to the sales manager's recommendation that capacity be diverted from Consumers to Industrials. value 3 0 the costs is not to be decis b de pue to rother loery ticket for 20. Just before the the ticket om her. The first Shades opporto