Question

Units produced Machine-hours Direct labor-hours Direct materials costs Direct labor costs Manufacturing overhead costs Total costs Basic 1,100 3,800 3,600 $18,000 64,500 Dominator 360 3,200 2,100 $ 5,650 45,500 Total 1,460 7,000 5,700 $ 23,650 110,000 209,370 $343,020 Tiger Furnishings's CFO believes that a two-stage cost allocation system would give managers better cost information. She asks the company's cost accountant to analyze the accounts and assign overhead costs to two pools: overhead related to direct labor cost and overhead related to machine-hours. The analysis of overhead accounts by the cost accountant follows: Manufacturing Overhead Utilities Supplies Training Supervision Machine depreciation Plant depreciation Miscellaneous Overhead Estimate $ 1,700 4,700 9,400 20,800 27,000 41,300 104,470 Cost Pool Assignment Machine-hour related Direct labor cost related Direct labor cost related Direct labor cost related Machine-hour related Machine-hour related Direct labor cost related Required: b. Compute the product costs per unit assuming that Tiger Furnishings uses direct labor costs and machine-hours to allocate overhead to the products. (Do not round intermediate calculations. Round your final answers to the nearest whole number.) Basic Dominator Total ſ Product Costing Direct material Direct labor Overhead Machine-related Labor-related Total overhead Total cost Units produced Unit cost $ $ 0 0 $ $ 0 0 $ $

Answer 1

Basic Dominator Total $18,000 $64,500 $5,650 $45,500 $23,650 $110,000 Product costing Direct material Direct labor Overhead Machine-related Labor-related Total overhead Total cost Units produced Unit cost $38,000 $88,023 $126,023 $208,523 1,100 $189.57 $32,000 $51,347 $83,347 $134,497 360 $373.60 $70,000 $139,370 $209,370 $343,020 1,460

Cost/ base Basic Dominator 10 $38,000 $32,000 Utilities Machine depreciation Plant depreciation Total Supplies Training Supervision Miscelleneous Total Base $1,700 Machine Hours $27,000 Machine Hours $41,300 Machine Hours $70,000 7,000 hours $4,700 Labor Hours $9,400 Labor Hours $20,800 Labor Hours $104,470 Labor Hours $139,370 5,700 hours 24.45088 $88,023 $51,347