Question

If Orange, Inc. uses direct labor hours to assign overhead, the unit product cost for Product X will be: $180.00. $80.00.

Answer 1

$24,200

Step-by-step explanation:

Hie, i have attached the full question as images below

When determining Product Costs we consider all Manufacturing Costs of a Product. This means we Consider both the Variable Manufacturing Costs such as Direct Materials and Direct Labor as well as Fixed Manufacturing Costs such as Lighting and Water.

The Fixed Costs are not traced directly to Products so we allocate them using surrogates (or cost drivers) in our case, we have been instructed to use direct labors to assign overheads (Fixed Costs)

Calculation of Product Cost for Product X

Direct Materials $6,600

Direct Labor $4,600

Overheads ($264,000 /2,000 x 100) $13,200

Total $24,200