Tiger Furnishings produces two models of cabinets for home theater components, t
ID: 2640007 • Letter: T
Question
Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow:
Basic Dominator Total
Units produced 1,000 250 1,250
Machine-hours 4,000 2,000 6,000
Direct labor-hours 3,000 2,000 5,000
Direct materials costs $10,000 $3,750 $13,750
Direct labor costs 64,500 35,500 100,000
Manufacturing overhead costs 174,100
TOTAL COSTS $287,850
Required:
Compute the individual product costs per unit assuming that Tiger Furnishings uses direct labor costs to allocate overhead to the products.(Do not round intermediate calculations. Round final answers to 2 decimal places.)
Unit Cost
Basic $ __________
Dominator $ ___________
Explanation / Answer
Hi,
Please find the detailed answer as follows:
Units Product Cost = (Direct Material + Direct Labor + Overheads)/Units Produced
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Basic = (10000 + 64500 + 174100*64500/100000)/1000 = $186.79
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Denominator = (3750 + 35500 + 174100*35500/100000)/250 = $404.22
Thanks.