Tiger Company has identified the following overhead costs and cost drivers for next year:
Overhead Item |
Expected Costs |
Cost Driver |
Maximum Quantity |
Setup costs |
$583,200 |
Number of setups |
2,400 |
Ordering costs |
270,000 |
Number of orders |
20,000 |
Maintenance |
928,000 |
Machine-hours |
32,000 |
Power |
90,000 |
Kilowatt-hours |
200,000 |
The following are two of the jobs completed during the year:
Job 201 |
Job 202 |
|||
Direct materials |
$9,000 |
$10,000 |
||
Direct labor |
$12,000 |
7,000 |
||
Units completed |
750 |
600 |
||
Direct labor-hours |
45 |
110 |
||
Number of setups |
6 |
7 |
||
Number of orders |
8 |
15 |
||
Machine-hours |
180 |
150 |
||
Kilowatt-hours |
90 |
120 |
||
Determine the unit cost for each job using the four cost drivers.
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