Cane Company manufactures two products called Alpha and Beta that sell for $205
ID: 2451158 • Letter: C
Question
Cane Company manufactures two products called Alpha and Beta that sell for $205 and $164, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 127,000 units of each product. Its unit costs for each product at this level of activity are given below:
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are deemed unavoidable and have been allocated to products based on sales dollars.
What is the total amount of traceable fixed manufacturing overhead for the Alpha product line and for the Beta product line?
Cane Company manufactures two products called Alpha and Beta that sell for $205 and $164, respectively. Each product uses only one type of raw material that costs $8 per pound. The company has the capacity to annually produce 127,000 units of each product. Its unit costs for each product at this level of activity are given below:
Explanation / Answer
Alpha Beta Traceable fixed manufacturing overhead 4064000 4445000 ($32 X 127000 Units) ($35 X 127000 Units)