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Stolb23 [73]
3 years ago
9

Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations a

nd costs for March follow:
Basic Dominator Total
Units produced 1,500 250 1,750
Machine-hours 4,000 2,000 6,000
Direct labor-hours 4,000 2,000 6,000
Direct materials costs $ 11,000 $ 3,500 $ 14,500
Direct labor costs 72,000 34,000 106,000
Manufacturing overhead costs 188,786
Total costs $ 309,286

Required:

Compute the individual product costs per unit assuming that Tiger Furnishings uses direct labor costs to allocate overhead to the products. (Do not round intermediate calculations. Round final answers to 2 decimal places.
Business
1 answer:
VARVARA [1.3K]3 years ago
7 0

Answer:

Basic = $140.82

Dominator = $392.216

Explanation:

For Basic:

Total cost for Basic:

= Direct materials costs + Direct labor costs + Manufacturing overhead

= $ 11,000 + $72,000 + $128,232

= $211,232

Per unit cost:

= Total cost for Basic ÷ Number of units produced

= $211,232 ÷ 1,500

= $140.82

For Dominator:

Total cost for Dominator:

= Direct materials costs + Direct labor costs + Manufacturing overhead

= $3,500 + $34,000 + $60,554

= $98,054

Per unit cost:

= Total cost for Basic ÷ Number of units produced

= $98,054 ÷ 250

= $392.216

Workings:

Manufacturing overhead (Basic):

= Manufacturing overhead costs × (Direct labor costs ÷ Total direct labor costs)

= $188,786 × ($72,000 ÷ $106,000)

= $128,232

Manufacturing overhead (Dominator):

= Manufacturing overhead costs × (Direct labor costs ÷ Total direct labor costs)

= $188,786 × ($34,000 ÷ $106,000)

= $60,554

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