Consider the following data for two products of Vigano Manufacturing.

Required
1. Using direct labor hours as the basis for assigning overhead costs, determine the total production cost per unit for each product line.
2. If the market price for Product A is $ 20 and the market price for Product B is $ 60, determine the profit or loss per unit for each product. Comment on the results.
3. Consider the following additional information about these two product lines. If ABC is used for as-signing overhead costs to products, what is the cost per unit for Product A and for Product B?

4. Determine the profit or loss per unit for each product. Should this information influence company strategy?Explain.

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Overhead Cost Product 10.000 units 0.20 DLH per unit 0.25 DLH per unit $2 per unit Product B 2,000 units $3 per unit Direct labor cost (@$24 per DLH) Activity Machine setup.... $121,000 Quality control $249.000 ProductA Product B Number of setups required for production.10 setups 12 setups Number of parts required.... parunit 3 parts/unit Inspection hours required..... 40 hours 10 hours