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Your company makes Product 1 and Product 2 using Activity A and Activity B. The cost driver for Activity A is direct labor hours and
- Your company makes Product 1 and Product 2 using Activity A and Activity B. The cost driver for Activity A is direct labor hours and the cost driver for Activity B is number of setups. Activity A costs $125,000 and Activity B costs $675,000. If Product 1 had activity proportions of 10% for Activity A and 40% for Activity B, then
- what is the total indirect cost assigned to Product 1?
- what is the total indirect cost assigned to Product 2?
- Your company makes Product 1 and Product 2 using Activity A and Activity B. The cost driver for Activity A is direct labor hours and the cost driver for Activity B is number of setups. Product 1 requires 800 direct labor hours and 70 setups, but Product 2 requires 400 direct labor hours and 90 setups. If Activity A had an activity rate of $13 per direct labor hour and Activity B had an activity rate of $24 per setup, then
- what is the total indirect cost assigned to Product 1?
- what is the total indirect cost assigned to Product 2?
- Your company makes Product 1 using Activity A and Activity B. The cost driver for Activity A is direct labor hours and the cost driver for Activity B is number of setups. Activity A has an activity rate of $10 per direct labor hour and Activity B has an activity rate of $150 per setup. One unit of Product 1 is sold for $200, requires $30 of direct materials and $60 of direct labor, and uses 8 direct labor hours and 4 setups. If your company sells 50 units of Product 1, then what is
- the total manufacturing cost per unit?
- the gross profit per unit?
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