Crazier, Inc., manufactures and sells two products: Product U8 and product W2. Data concerning the expected production of each product and expected total direct labor-hours (DLHs) required to produce that output appear below:
Expeced Production Direct Labor-Hours Per Unit Total Direct Labor-Hours Product U8 500 6.0 3,000 Product W2 400 5.0 2,000 Total direct labor-hours 5,000
The direct labor rate is $22.10 per DLH. The direct materials cost per unit for each product is given below:
Direct Materials Cost Per Unit Product U8 $160.80 Product W2 $185.40
The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
[ Estimated ] [ Estimated Activity ]
Activity Cost Pools Activity Measures Overhead Cost Product U8 Product W2 Total Labor-related DLHs $237,900 3,000 2,000 5,000 Production orders orders 29,232 600 800 1,400 General factory MHs 364,364 4,700 4,400 9,100 $631,496
The unit product cost of Product U8 is closest to:
a) $995.06 per unit
b) $1,051.20 per unit
c) $ 980.31 per unit
d) $669.78 per unit
Crazier, Inc., manufactures and sells two products: Product U8 and product W2. Data concerning the expected production of each product and expected total direct labor-hours (DLHs) required to produce that output appear below:
| Expeced Production | Direct Labor-Hours Per Unit | Total Direct Labor-Hours | |
| Product U8 | 500 | 6.0 | 3,000 |
| Product W2 | 400 | 5.0 | 2,000 |
| Total direct labor-hours | 5,000 |
The direct labor rate is $22.10 per DLH. The direct materials cost per unit for each product is given below:
| Direct Materials Cost Per Unit | |
| Product U8 | $160.80 |
| Product W2 | $185.40 |
The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
[ Estimated ] [ Estimated Activity ]
| Activity Cost Pools | Activity Measures | Overhead Cost | Product U8 | Product W2 | Total |
| Labor-related | DLHs | $237,900 | 3,000 | 2,000 | 5,000 |
| Production orders | orders | 29,232 | 600 | 800 | 1,400 |
| General factory | MHs | 364,364 | 4,700 | 4,400 | 9,100 |
| $631,496 |
The unit product cost of Product U8 is closest to:
a) $995.06 per unit
b) $1,051.20 per unit
c) $ 980.31 per unit
d) $669.78 per unit
Related questions
Machuga, Inc., manufactures and sells two products: Product C1and Product M2. Data concerning the expected production of eachproduct and the expected total direct labor-hours (DLHs) requiredto produce that output appear below:
Expected Production | Direct Labor-Hours Per Unit | Total Direct Labor-Hours | |
Product C1 | 800 | 9.0 | 7,200 |
Product M2 | 700 | 11.0 | 7,700 |
Total direct labor-hours | 14,900 |
The direct labor rate is $18.70 per DLH. The direct materials costper unit is $297.00 for Product C1 and $246.20 for ProductM2.
The company is considering adopting an activity-based costingsystem with the following activity cost pools, activity measures,and expected activity:
| Estimated | Expected Activity | ||||
| Activity Cost Pools | Activity Measures | Overhead Cost | Product C1 | Product M2 | Total |
| Labor-related | DLHs | $558,452 | 7,200 | 7,700 | 14,900 |
| Production orders | orders | 75,240 | 500 | 600 | 1,100 |
| General factory | MHs | 886,410 | 4,400 | 4,600 | 9,000 |
| $1,520,102 | |||||
The overhead applied to each unit of Product M2 underactivity-based costing is closest to:
$1,118.13 per unit
$1,122.22 per unit
$647.22 per unit
$1,013.40 per unit
Boutet, Inc., manufactures and sells two products: Product G5 and Product U1. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below:
| Expected Production | Direct Labor-Hours Per Unit | Total Direct Labor-Hours | |
| Product G5 | 800 | 5.0 | 4,000 |
| Product U1 | 800 | 3.0 | 2,400 |
| Total direct labor-hours |
|
The direct labor rate is $21.10 per DLH. The direct materials cost per unit is $241.40 for Product G5 and $283.80 for Product U1.
The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
| Expected Activity | |||||
| Activity Cost Pools | Activity Measures | Estimated | Product | Product |
|
| Labor-related | DLHs | $200,640 | 4,000 | 2,400 | 6,400 |
| Production orders | orders | 14,959 | 400 | 300 | 700 |
| General factory | MHs | 610,416 | 4,200 | 3,900 | 8,100 |
| $826,015 | |||||
If the company allocates all of its overhead based on direct labor-hours using its traditional costing method, the overhead assigned to each unit of Product G5 would be closest to:
$376.80 per unit
$645.30 per unit
$106.85 per unit
$156.75 per unit
Serva, Inc., manufactures and sells two products: Product R4 andProduct N4. Data concerning the expected production of each productand the expected total direct labor-hours (DLHs) required toproduce that output appear below:
| Expected Production | DirectLabor-Hours Per Unit | TotalDirect Labor-Hours | |
| Product R4 | 800 | 6.0 | 4,800 |
| Product N4 | 300 | 3.0 | 900 |
| Total directlabor-hours | 5,700 |
The direct labor rate is $24.70 per DLH. The direct materials costper unit for each product is given below:
| DirectMaterials Cost per Unit | |
| Product R4 | $202.10 |
| Product N4 | $289.90 |
The company is considering adopting an activity-based costingsystem with the following activity cost pools, activity measures,and expected activity:
| Estimated | Expected Activity | ||||
| Activity Cost Pools | ActivityMeasures | Overhead Cost | ProductR4 | ProductN4 | Total |
| Labor-related | DLHs | $86,811 | 4,800 | 900 | 5,700 |
| Machinesetups | setups | 29,000 | 400 | 600 | 1,000 |
| Generalfactory | MHs | 122,520 | 3,100 | 2,900 | 6,000 |
| $238,331 | |||||
The activity rate for the Labor-Related activity cost pool underactivity-based costing is closest to:
$15.23 per DLH
$238.33 per DLH
$72.50 per DLH
$48.33 per DLH
