Superb Professors

Determine the total and per-unit costs of manufacturing the Gas Cooker and Charcoal Smoker
for the month, assuming all manufacturing overhead is assigned on the basis of direct labor
dollars.
Determine the total and per-unit costs of manufacturing the Gas Cooker and Charcoal Smoker
for the month, assuming manufacturing overhead is assigned using activity-based costing.
Gas Cooker
Units …………………………………………. 2,000
Number of batches……………………………… 50
Number of batch moves …………………………. 90
Direct materials ………………………………… $70,000
Direct labor……………………………………. $44,000
Charcoal Smoker
Units …………………………………………. 8,000
Number of batches……………………………… 20
Number of batch moves …………………………. 50
Direct materials ………………………………… $130,000
Direct labor……………………………………. $56,000
Manufacturing overhead follows:
Activity
Materials acquisition and inspection …………… Cost: $68,000 – Cost Driver: Amount of direct materials cost
Materials movement…………………………. Cost: $19,600 – Cost Driver: Number of batch moves
Scheduling ………………………………… Cost: $43,4 00- Cost Driver: Number of batches
Total cost: $131,000
 
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