Aigo Mobile, produces two smartphones: Basic, which retails for $500 per unit, and Pro, the latest...

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Aigo Mobile, produces two smartphones: Basic, which retails for $500 per unit, and Pro, the latest smartphone launched at $900 per unit. Aigo Mobile wants to optimize the pricing and cost management of each product line. In 2021, Aigo Mobile will produce 10,000 Basic units and 15,000 Pro units. Currently, overhead is allocated based on Machine Hours. The Aigo Mobile controller wondered if the current accounting system had provided the best information for making selling pricing decisions. After meeting with key managers and several operations and sales staff, the Aigo Mobile Controller agreed to implement ABC and define four activities: machine set-up, production, quality control, and delivery. Aigo Mobile has also compiled the following information on the company's manufacturing overhead costs for the year ended December 31, 2021 Total Activity Activity Driver Unit Activity (Allocation Base) Costs Basic Pro Machine set-up (set-up amount) 930,000 8,000 22,000 300,000 Production (number of machine hours) 1,350,000 150,000 Quality Control (number of inspections) 1,440,000 32,000 64,000 Shipping (delivery amount) 105,000 100 150 Basic Pro Direct Raw Materials per unit 40 70 Direct Labor Cost per hour 32 32 Direct Labor Hours per unit 2.80 4.25 Required: 1. Calculate production costs per unit using traditional costing for each product 2. Calculate the production cost per unit using ABC costing for each product 3. Give your comments the results of both methods for each product, give your suggestions to management Aigo Mobile, produces two smartphones: Basic, which retails for $500 per unit, and Pro, the latest smartphone launched at $900 per unit. Aigo Mobile wants to optimize the pricing and cost management of each product line. In 2021, Aigo Mobile will produce 10,000 Basic units and 15,000 Pro units. Currently, overhead is allocated based on Machine Hours. The Aigo Mobile controller wondered if the current accounting system had provided the best information for making selling pricing decisions. After meeting with key managers and several operations and sales staff, the Aigo Mobile Controller agreed to implement ABC and define four activities: machine set-up, production, quality control, and delivery. Aigo Mobile has also compiled the following information on the company's manufacturing overhead costs for the year ended December 31, 2021 Total Activity Activity Driver Unit Activity (Allocation Base) Costs Basic Pro Machine set-up (set-up amount) 930,000 8,000 22,000 300,000 Production (number of machine hours) 1,350,000 150,000 Quality Control (number of inspections) 1,440,000 32,000 64,000 Shipping (delivery amount) 105,000 100 150 Basic Pro Direct Raw Materials per unit 40 70 Direct Labor Cost per hour 32 32 Direct Labor Hours per unit 2.80 4.25 Required: 1. Calculate production costs per unit using traditional costing for each product 2. Calculate the production cost per unit using ABC costing for each product 3. Give your comments the results of both methods for each product, give your suggestions to management

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Working notes Predetermined overhead OH allocation rate Estimated overheads Estimated machine hours ... View the full answer