Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow:
|
Basic |
Dominator |
Total |
| Units produced |
|
1,420 |
|
|
440 |
|
|
1,860 |
| Machine-hours |
|
3,300 |
|
|
2,700 |
|
|
6,000 |
| Direct labor-hours |
|
2,900 |
|
|
3,300 |
|
|
6,200 |
|
|
|
|
|
|
|
|
|
| Direct materials costs |
$ |
16,000 |
|
$ |
5,450 |
|
$ |
21,450 |
| Direct labor costs |
|
63,500 |
|
|
51,500 |
|
|
115,000 |
| Manufacturing overhead costs |
|
|
|
|
|
|
|
194,510 |
|
|
|
|
|
|
|
|
|
| Total costs |
|
|
|
|
|
|
$ |
330,960 |
|
|
|
|
|
|
|
|
|
|
|
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 |
Overhead
Estimate |
Cost Pool Assignment |
| Utilities |
$ |
1,500 |
Machine-hour related |
| Supplies |
|
4,600 |
Direct labor cost related |
| Training |
|
9,200 |
Direct labor cost related |
| Supervision |
|
25,800 |
Direct labor cost related |
| Machine depreciation |
|
23,000 |
Machine-hour related |
| Plant depreciation |
|
23,500 |
Machine-hour related |
| Miscellaneous |
|
106,910 |
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 the direct-labor cost rate in your intermediate calculations. Round your answers to two decimal places.)
|