Question

quired: 1. Using ABC, compute the overhead cost per unit for each product line. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $220 for Model 145 and $118 for Model 212. 3. If the market price for Model 145 is $689.31 and the market price for Model 212 is $382.07, determine the profit or loss per unit for each model.

Answer 1

Particulars : Model 145 ; Model 212

Price per unit : $689.31 ; $382.07

Cost per unit : $479.13 : $290.08

Profit per unit: $210.18 ; $91.99

Step-by-step explanation:

Overheads assigned are:

Activity : Model 145 ; Model 212

Changeover : 250,000 ; 250,000

Machining : 83,700 ; 195,300

Setups : 112,500 ; 112,500

Finishing : 48,080 ; 132,220

Welding : 120,000 ; 90,000

Inspecting : 40,000 ; 35,000

Rework : 90,000 ; 45,000

Support : 29,100 ; 67,900

Purchasing : 7733 ; 9279

Providing space and utilities : 515 ; 268

Per unit cost is : 259.13 ; 172.08

Total cost is:

Model 145 : $220 + $259.13 = 479.13

Model 212 : $118 + $172.08 = 290.08