Consider the following data for two products of Gltano Manufacturing. (Loss amou

Question

Consider the following data for two products of Gltano Manufacturing. (Loss amounts should be Indicated with a minus sign. Round your Intermedlate calculatlons and "OH rate and cost per unlt" answers to 2 declmal places) Product A Product B Number of units produced Direct labor cost (@ $25 per DLH) Direct materials cost 12,500 units 0.19 DLH per unit 1.50 per unit 1,600 units 0.23 DLH per unit S 2.70 per unit Activity Overhead costs Machine setup Materials handling Quality control inspections $108,89:3 57,000 83,720 $249,613 Required Using direct labor hours as the basis for assigning overhead costs, determine the total production cost per unit for each product line. Number of parts $ 12,500 Direct labor costs OH Cost per unit Overhead Assigned Product A Product B Activity Driver Plantwide OH rate Total Overhead Cost Units Produced Product A Product B If the market price for Product A is $28.66 and the market price for Product B is $57, determine the profit or loss per unit for each roduct. Product A Product B Market price

Explanation / Answer

1.

Direct labor hours = (12500 x 0.19) + (1600 x 0.23) = 2375 + 368 = 2743

2.

3.

4.

4.2 Yes

Overhead costs $249,613 $91.00 per DLH Direct labor hours 2743 Overhead Assigned Activity Driver Plantwide OH rate Total Overhead Cost Units Produced OH Cost per unit Product A 2375 $91.00 $216,125 12500 $                            17.29 Product B 368 $91.00 $ 33,488 1600 $                            20.93 Product A Product B Direct materials per unit $1.50 $2.70 Direct labor per unit $0.19 $0.23 Overhead per unit $17.29 $20.93 Total manufacturing cost per unit $18.98 $23.86

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