What would be the cost per unit of Android be using factory space and labor as t
ID: 2789298 • Letter: W
Question
What would be the cost per unit of Android be using factory space and labor as the allocation basis? Use the information in the table. For Robot, space as an allocation method = 70/(70+30)=70%. Similarly Android is 30%.
Variable cost for Robot = 20 x .70 = $14 million. For Android variable cost = 20 x .30 = $6 million.
So, the total cost for Android without components = (5 x .30) + 6 = $7.5 million. Cost for Android space allocation = 25 k + (7.5 m /300) = $50,000.
Complete the cost for labor similarly.
Square Feet Labor Processor01 (500 units) 70,000 120 Android01 (300 units) 30,000 80Explanation / Answer
Cost per unit of Android using labor as the allocation basis:
Weight of Android = 80 / (80+120) = 80 / 200 = 40%
Variable Cost = 20 * 40% = $8 million
Total Cost of Android without components = (5 * 40%) + 8 = $10 million
Total Cost per unit of Android = 25000 + (10 m / 300) = 25000 + 33333 = $58333
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