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Check my work mode : This shows whet is correct or incorrect for the work you have completed so far. It does not indicate completion. Return to question 3 Kitchen Kings toledo plant mamutacturethree Procct nsel mot-tu product models are the Regufar (REG), the Advanced AD), and the Gourmet (GMT). Until recently, the plant used a ob-order product-costing system. with manufacturing overhead all mult-butnec cerarnc cookto plant's three applied on the basis of ditional costing system was based. Planned annual production Volume in units Production runs 2e cuns of 5e units runs of 125 units 2 points Direct material 9 setup) (not including per product unit by product line in a year Machine houns (H) Total machine hours consumed 48,0ae 7 MH 1, 000) is $12 per The annual budgeted overnead is s1224000, and the company's predetertmaned overhead rate is s2 per reported under the plants traditional costing system borhour The procust costs for the thtee product models as r are shown ini the following table Direct moterial Direct labor (not including set-up Kitchen King's pncing policy is to set a target price for each product equal to 130 percent of the full product cost Due to price competition from other appliance manufachirers REG uhits were selling at $525. and ADV units were selling for $628. These prices were somewhat below the firm's target prices. However these results were partially offset by greater-than-expected profits on the GMT product ine. Mänagement had raised the price on the GMT model to $800, which was higher than the original target price. Even at this pice, Kitchen King's customers did not seem to hesitate to place orders Moreover the company's competitors did not mount a challenge in the market fon the GMT product line Nevertheless. concern contihued to mount in Toledo about the difficulty in the REG a markets Ater al, these were the plamts preed and-butter products, with projected annual sales of 5,000 REG units nd ADV and 4.000 ADV of 7lNext O Type here to search

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