Cane Company manufactures two products called Alpha and Beta that sell for $185 and $150, respectively. Each product uses only o

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2 years ago

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Cane Company manufactures two products called Alpha and Beta that sell for $185 and $150, respectively. Each product uses only o

ne type of raw material that costs $8 per pound. The company has the capacity to annually produce 119,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Alpha Beta Direct materials $ 40 $ 24 Direct labor 33 28 Variable manufacturing overhead 20 18 Traceable fixed manufacturing overhead 28 31 Variable selling expenses 25 21 Common fixed expenses 28 23 Total cost per unit $ 174 $ 145 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Required: 1. What is the total amount of traceable fixed manufacturing overhead for each of the two products

Business

1 answer:

Charra [1.4K] · Answer 1 · 2023-04-11T16:02:30+03:00

The total amount of traceable fixed manufacturing overhead for Alpha and Beta will be $3332000 and $3689000.

<h3>How to compute manufacturing overhead? </h3>

From the information given, the traceable fixed manufacturing overhead for Alpha will be:

= 119000 × 28

= $3332000

The traceable fixed manufacturing overhead for Beta will be:

= 119000 × 31

= $3689000

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