Danno Company manufactures two products, Product F and Product G. The company expects to produce and sell 600 units of Product F and 6,000 units of Product G during the current year. The company uses activity based costing to compute unit product costs for external reports. Data relating to the company”s three activity cost pools are given below for the current year:
|
|
Estimated |
Expected Activity |
||
|
|
Overhead |
|
|
|
|
Activity Cost Pool |
Costs |
Product F |
Product G |
Total |
|
Machine setups |
$5,250 |
60 |
150 |
210 |
|
Purchase orders |
$74,100 |
620 |
1,280 |
1,900 |
|
General factory |
$89,880 |
840 |
12,000 |
12,840 |
Required:
Using the activity based costing approach, determine the overhead cost per unit for each product.