Your company produces two products:Product X and Product Y.Each month you produce and sell 250 units of Product X and 750 Units of product Y for a total of 1,000 units.The products each sell for $500 a piece.Your workers are not assigned to Product X or Y, but work where needed as needed.The same materials are used in the production of each product, and are used from inventory as needed.Using a Traditional Costing method where the Cost Object for each cost is Units Produced / Sold allocate the costs between Product X and Product Y.Calculate the Net Operating Income Per Product, and determine which product is more profitable on a per unit basis.

Totals Product X Product Y Units Produced & Sold 1,000 250 750 Sales $500,000 $125,000 $375,000 Cost of Goods Sold Direct Labor Costs 143,750 Materials Costs 212,500 Total Cost of Goods Sold 356,250 Gross Profit 143,750 Operating Expenses Factory Rent Expense 35,000 Electricity Expense 8,000 Total Operating Expenses 43,000 Net Operating Income $100,750 Net Operating Income per Unit $100.75 Gross Profit = Sales - Total Cost of Goods Sold Net Operating Income = Gross Profit - Total Operating Expenses Net Operating Income per Unit = Net Operating Income divided by Units Produced & Sold