Question

Knowledge Check 01 Activities Activity Rates Assembly $ 14.35 per machine-hour Processing Orders $ 47.85 per order inspection $ 70.30 per inspection-hour True Blue Corporation provided the data set forth above from its activity-based costing system. The company makes 430 units of product D28K a year, requiring a total of 690 machine-hours, 40 orders, and 10 inspection-hours per year. The product's direct materials cost is $35.82 per unit and its direct labor cost is $29.56 per unit. What is the unit product cost of product D28K

Answer 1

Answer:

$94.49

Explanation:

The computation of the unit product cost of product D28K is shown below:-

Total cost = Direct material cost + Direct labor cost + Assembly + Processing orders + Inspection

= ($35.82 × 430) + ($29.56 × 430) + (690 × $14.35) + (40 × 47.85) + (10 × $70.30)

= $15,402.60 + $12,710.80 + $9,901.50 + $1,914 + $703

= $40,631.90

Unit product cost = Total cost ÷ Number of units manufactured

= $40,631.90 ÷ 430

= $94.49