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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 $72 $110 Direct materials 36 41 Direct labor 26 31 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. Using activity-based costing, the company computes 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

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