PopUp Company produces two types of toasters, basic and deluxe. For the current period, the company reports
Question:
PopUp Company produces two types of toasters, basic and deluxe. For the current period, the company reports the following data:
Basic Toaster Deluxe Toaster
Volume 20,000 units 5,000 units
Machine Hours 1,000 2,400
Batches 315 125
Engineering Modifications 20 50
Prime Costs $20,000 $30,000
Market Price $25 per unit $60 per unit
Additional Information Follows Costs Driver
Engineering Support $15,900 Engineering Modifications
Electricity 25,000 Machine Hours
Setup costs 33,900 Batches
1) Compute the manufacturing cost per unit of each toaster using the current unit-based approach. Under this system costs are assigned to the toasters on the basis of machine hours.
2) Compute the manufacturing cost per unit of each toaster using an actives-based costing approach
Fundamental accounting principle
ISBN: 978-0078025587
21st edition
Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta