Question
Everlast Co. manufactures a variety of drill bits. The company's plant is partially automated. The budget...
Everlast Co. manufactures a variety of drill bits. The company's plant is partially automated. The budget for the year includes $432,000 payroll for 4,800 direct labor-hours. Listed below is cost driver information used in the product-costing system:
|
Overhead Cost Pool |
Budgeted Overhead |
Cost Driver |
Estimated Cost Driver Level |
|
Machine setups |
$120,000 |
# of setups |
120 setups |
|
Materials handling |
104,400 |
# of barrels |
8,700 barrels |
|
Quality control |
264,000 |
# of inspections |
1,100 inspections |
|
Other overhead cost |
144,000 |
# of machine hours |
12,000 machine hours |
|
Total overhead |
$632,400 |
A current product order has the following requirements:
|
Machine setups |
8 setups |
|
Materials handling |
606 barrels |
|
Quality inspections |
80 inspections |
|
Machine hours |
830 machine hours |
|
Direct labor hour |
336 hours |
Compute the unit manufacturing cost and the total manufacturing costs of the order. Show calculations.
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