Ok so here are the correct numbers to put in. I have the Traditional portion correct, I would like to see the ABC portion of this with these numbers worked out, because I’m at the end of the equation but with these numbers please:
Exercise 3 7 Contrast ABC and Conventional Product Costs [LO2, LO3, LO4]
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Kunkel Company makes two products and uses a conventional costing system in which a single plantwide predetermined overhead rate is computed based on direct labor hours. Data for the two products for the upcoming year follow: |
| Mercon | Wurcon | |||
| Direct materials cost per unit | $ | 12.90 | $ | 21.40 |
| Direct labor cost per unit | $ | 5.40 | $ | 3.50 |
| Direct labor hours per unit | 0.48 | 0.26 | ||
| Number of units produced | 21,000 | 72,000 | ||
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| These products are customized to some degree for specific customers. |
| Required: | |
| 1. |
The company’s manufacturing overhead costs for the year are expected to be $696,960. Using the company’s conventional costing system, compute the unit product costs for the two products. (Do not round intermediate calculation. Round your final answers to 2 decimal places.) |
| Mercon | Wurcon | |
| Unit product cost | $ | $ |
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| 2. |
Management is considering an activity based costing system in which half of the overhead would continue to be allocated on the basis of direct labor hours and half would be allocated on the basis of engineering design time. This time is expected to be distributed as follows during the upcoming year: |
| Mercon | Wurcon | Total | |
| Engineering design time (in hours) | 2,300 | 2,100 | 4,400 |
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Compute the unit product costs for the two products using the proposed ABC system. (Round your final answers to 2 decimal places.) |
| Mercon | Wurcon | |
| Unit product cost | $ | $ |