Potter Company manufactures two models of exercise bikes - the ST100 and the EX500. The current...

 

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Potter Company manufactures two models of exercise bikes - the ST100 and the EX500. The current cost accounting system allocates manufacturing support costs to the two products on the basis of direct labor hours. For 2016, the company has estimated that it will incur $1,017,000 in manufacturing support costs, work 60,000 direct labor hours, and produce 10,000 units of the EX500 model and 40,000 units of the ST100 model. The EX500 model requires two hours of direct labor to assemble and the ST100 requires one hour of direct labor to assemble. Material and labor costs per unit and the selling price per unit are as follows: ST100 EX500 Direct material $32 $45 Direct Labor 10 20 Selling Price 90 150 What is the total cost to produce one unit of the ST100 bike? What is the total cost to produce one unit of the EX500 bike? RI Potter Company manufactures two models of exercise bikes - the ST100 and the EX500. The current cost accounting system allocates manufacturing support costs to the two products on the basis of direct labor hours. For 2016, the company has estimated that it will incur $1,017,000 in manufacturing support costs, work 60,000 direct labor hours, and produce 10,000 units of the EX500 model and 40,000 units of the ST100 model. The EX500 model requires two hours of direct labor to assemble and the ST100 requires one hour of direct labor to assemble. Material and labor costs per unit and the selling price per unit are as follows: ST100 EX500 Direct material $32 $45 Direct Labor 10 20 Selling Price 90 150 What is the total cost to produce one unit of the ST100 bike? What is the total cost to produce one unit of the EX500 bike? RI

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