Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and lines appear below: Selling price per unit Xtreme $ 126.00 Pathfinder $ 91.00 Direct materials per unit $ 63.20 $ 51.00 Direct labor per unit $ 11.70 $ 9.00 Direct labor-hours per unit Estimated annual production and sales 1.3 DLHS 21,000 units 1.0 DLHS 75,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $ 2,250,600 102,300 DLHS Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and id
Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and lines appear below: Selling price per unit Xtreme $ 126.00 Pathfinder $ 91.00 Direct materials per unit $ 63.20 $ 51.00 Direct labor per unit $ 11.70 $ 9.00 Direct labor-hours per unit Estimated annual production and sales 1.3 DLHS 21,000 units 1.0 DLHS 75,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $ 2,250,600 102,300 DLHS Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and id
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter11: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 17E: Product cost method of product costing Smart Stream Inc. uses the product cost method of applying...
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