Answer:
Unitary cost= $5.44
Explanation:
The annual production and sales level of Product B2 is 23,710 units.
<u>First, we need to calculate the activities rates:</u>
Predetermined manufacturing overhead rate= total estimated overhead costs for the period/ total amount of allocation base
Activity 1= 62,000/ (2,600 + 6,160)= $7.08 per unit of activity
Activity 2= 77,000/ (6,200 + 8,600)= $5.20 per unit of activity
Activity 3= 108,000 / (3,640 + 2,200)= $18.49 per unit of activity
<u>Now, we allocate costs to Product B1:</u>
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Allocated MOH= Estimated manufacturing overhead rate* Actual amount of allocation base
Activity 1= 7.08*6,160= 43,612.8
Activity 2= 5.20*8,600= 44,720
Activity 3= 18.49*2,200= 40,678
Total allocated costs= $129,010.8
<u> Finally, the unitary cost:</u>
Unitary cost= 129,010.8/23,710= $5.44
