Wess Company has limited capacity and can produce either its standard product or its deluxe product Additional information follows Per Unit Standard Deluxe Selling price $ 70 $ 108 Direct materials 35 40 Direct labor 25 30 1 Using a single plantwide rate, the company computes the overhead cost per unit of $18 for the standard model and $23 for the deluxe model Which model should the company produce Hint Compute product cost per unit and compare that with selling price to get gross profit per unit 2 Using activity based costing, the company computes the overhead cost per unit of $2 for the standard model and $53 for the deluxe model Which model should the company produce Hint Compute product cost per unit and compare that with selling price per unit to get gross profit per unit Complete this question by entering your answers in the tabs below Using a single plantwide rate, the company computes overhead cost per unit of $18 for the standard model and $23 for the deluxe model Which model should the company produce Hint Compute product cost per unit and compare that with selling price to get gross profit per unit (A negative gross profit should be indicated with a minus sign ) Product cost per unit Direct materials Direct Labor Overhead Product Cost per unit Standard $35 $25 Deluxe $40 $30 Gross profit per unit Selling price Product cost Gross profit Standard Deluxe Which model should the company produce Using activity based costing, the company computes the overhead cost per unit of $2 for the standard model and $53 for the deluxe model Which model should the company produce Hint Compute product cost per unit and compare that with selling price per unit to get gross profit per unit Product cost per unit Direct materials Direct labor Overhead Product Cost per Unit Standard $35 $25 Deluxe $40 $30 Gross profit per unit Selling price Product cost Gross profit Standard Deluxe Which model should the company produce Using activity based costing, the company computes the overhead cost per unit of $2 for the standard model and $53 for the deluxe model Which model should the company produce Hint Compute product cost per unit and compare that with selling price per unit to get gross profit per unit Product cost per unit Direct materials Direct labor Overhead Product Cost per Unit Standard $35 $25 Deluxe $40 $30 Gross profit per unit Selling price Product cost Gross profit Standard Deluxe Which model should the company produce

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Wess Company has limited capacity and can produce either its standard product or its deluxe product. Additional information follows. Per Unit Standard Deluxe Selling price

Wess Company has limited capacity and can produce either its standard product or its deluxe product. Additional information follows.

Per Unit	Standard	Deluxe
Selling price	$ 70	$ 108
Direct materials	35	40
Direct labor	25	30

1. Using a single plantwide rate, the company computes the overhead cost per unit of $18 for the standard model and $23 for the deluxe model. Which model should the company produce? Hint: Compute product cost per unit and compare that with selling price to get gross profit per unit.
2. Using activity-based costing, the company computes the overhead cost per unit of $2 for the standard model and $53 for the deluxe model. Which model should the company produce? Hint: Compute product cost per unit and compare that with selling price per unit to get gross profit per unit.

Complete this question by entering your answers in the tabs below.

Using a single plantwide rate, the company computes overhead cost per unit of $18 for the standard model and $23 for the deluxe model. Which model should the company produce? Hint: Compute product cost per unit and compare that with selling price to get gross profit per unit. (A negative gross profit should be indicated with a minus sign.)

Product cost per unit:	Direct materials	Direct Labor	Overhead	Product Cost per unit
Standard	$35	$25
Deluxe	$40	$30

Gross profit per unit:	Selling price	Product cost	Gross profit
Standard
Deluxe

Which model should the company produce?

Using activity-based costing, the company computes the overhead cost per unit of $2 for the standard model and $53 for the deluxe model. Which model should the company produce? Hint: Compute product cost per unit and compare that with selling price per unit to get gross profit per unit.

Product cost per unit:	Direct materials	Direct labor	Overhead	Product Cost per Unit
Standard	$35	$25
Deluxe	$40	$30

Gross profit per unit:	Selling price	Product cost	Gross profit
Standard
Deluxe

Which model should the company produce?

Product cost per unit:	Direct materials	Direct labor	Overhead	Product Cost per Unit
Standard	$35	$25
Deluxe	$40	$30

Gross profit per unit:	Selling price	Product cost	Gross profit
Standard
Deluxe

Which model should the company produce?