Howrley-David, Inc., manufactures two models of motorcycles: the Fatboy and the

Question

Howrley-David, Inc., manufactures two models of motorcycles: the Fatboy and the Screamer. Both models are assembled in the same plant and require the same assembling operations. The difference between the models is the cost of materials. The following data are available for August.

Fatboy Screamer

Total Number of units assembled(Fatboy: 990) (Screamer: 1,980) (Total: 2,970)

Materials cost per unit (Fatboy: $2,100) (Screamer $3,100)

Other costs:

Direct labor Total $ 3,207,600

Indirect materials Total 534,600

Other overhead Total 1,603,800

Required: Howrley-David uses operations costing and assigns conversion costs based on the number of units assembled. Compute the cost of each model assembled in August.

Fatboy = ..... Unit cost

Screamer= .... Unit cost

Explanation / Answer

Howrley David Inc Details Amt $ August Details Total Conversion Costs   Total Direct Labor Cost     3,207,600.00 Indirect Materials         534,600.00 Other Overhead     1,603,800.00 Total Conversion Costs       5,346,000.00 Total Units assembled              2,970.00 Conversion cost per model assembled              1,800.00 Unit Cost of Each Model Details Fatboy Screamer Matreial cost per unit              2,100.00            3,100.00 Conversion cost per unit              1,800.00            1,800.00 Total Unit cost of each model              3,900.00            4,900.00

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