Pacifica Industrial Products Corporation makes two products, Product H and Product L . Product H is expected
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Question:
Pacifica Industrial Products Corporation makes two products, Product H and Product L Product H is expected to sell units next year and Product L is expected to sell units. A unit of either product requires direct laborhours.
The company's total manufacturing overhead for the year is expected to be $
Required:
a The company currently applies manufacturing overhead to products using direct laborhours as the allocation base. If this method is followed, how much overhead cost per unit would be applied to each product?
b Compute the total amount of overhead cost that would be applied to each product.
Management is considering an activitybased costing system and would like to know what impact this change might have on product costs. For purposes of discussion, it has been suggested that all of the manufacturing overhead be treated as a productlevel cost. The total manufacturing overhead would be divided in half between the two products, with $ assigned to Product H and $ assigned to Product L
If this suggestion is followed, how much overhead cost per unit would be assigned to each product? The company currently applies manufacturing overhead to products using direct laborhours as the allocation base. If this method is followed, how much overhead cost per unit would be applied to each product? Round your answers to decimal places.
Product H Product L
Overhead cost per unit Compute the total amount of overhead cost that would be applied to each product.
Product H Product L Total
Total overhead cost Management is considering an activitybased costing system and would like to know what impact this change might have on product costs. For purposes of discussion, it has been suggested that all of the manufacturing overhead be treated as a productlevel cost. The total manufacturing overhead would be divided in half between the two products, with $ assigned to Product H and $ assigned to Product L
If this suggestion is followed, how much overhead cost per unit would be assigned to each product? Round your answers to decimal places.
Product H Product L
Overhead cost per unit
Related Book For
Introduction to Managerial Accounting
ISBN: 978-0078025792
7th edition
Authors: Peter Brewer, Ray Garrison, Eric Noreen
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