Comparing cost under ABC to traditional plantwide overhead rate P1 P3 A1 A2
Teradyne Crystal makes fine tableware in its Ireland factory. The following data are taken from its production plans for 2011.
Direct labor costs | €5,870,000 |
Setup costs | 630,000 |
| Wine Glasses | Commemorative Vases |
Expected production | 211,000 units | 17,000 units |
Direct labor hours required | 254,000 DLH | 16,400 DLH |
Machine setups required | 200 setups | 800 setups |
Required
1. Determine the setup cost per unit for the wine glasses and for the commemorative vases if setup costs are assigned using a single plantwide overhead rate based on direct labor hours.
2. Determine setup costs per unit for the wine glasses and for the commemorative vases if the setup costs are assigned based on the number of setups.
3. Which method is better for assigning costs to each product? Explain.
We need at least 10 more requests to produce the solution.
0 / 10 have requested this problem solution
The more requests, the faster the answer.