Pachero,Inc. ,manufactures and sells two products: Product T1 and Product U6.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below: The direct labor rate is $15.90 per DLH.The direct materials cost per unit is $259.80 for Product T1 and $188.80 for Product U6. The company is considering adopting an activity-based costing system with the following activity cost pools,activity measures,and expected activity: The unit product cost of Product U6 under activity-based costing is closest to:
A)$2,305.84 per unit
B)$1,124.00 per unit
C)$1,472.65 per unit
D)$3,025.80 per unit

Question

Pachero,Inc. ,manufactures and sells two products: Product T1 and Product U6.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below:  The direct labor rate is $15.90 per DLH.The direct materials cost per unit is $259.80 for Product T1 and $188.80 for Product U6. The company is considering adopting an activity-based costing system with the following activity cost pools,activity measures,and expected activity:  The unit product cost of Product U6 under activity-based costing is closest to:
A)$2,305.84 per unit 
B)$1,124.00 per unit 
C)$1,472.65 per unit 
D)$3,025.80 per unit

Quizplus · Accepted Answer

Computation of activity rates:
 11eaa3fe_3358_ce74_908b_25b6dea68530_TB2461_00 Computation of the overhead cost per unit under activity-based costing.
 11eaa3fe_3358_ce75_908b_d7eb5f33608a_TB2461_00 Computation of unit product costs under activity-based costing.
 11eaa3fe_3358_f586_908b_219c17a228f5_TB2461_00