XYZ Company manufactures and distributes two products, M and XY. Overhead costs are currently allocated using the number of units produced as the allocation base. The controller has recommended changing to an activity-based costing (ABC) system. She has collected the following information:   Activity Cost Driver Amount M XY   Production setups Number of setups $ 82,000   8   12   Material handling Number of parts   48,000   56   24   Packaging costs Number of units   130,000   50,000   80,000       $ 260,000             What is the total overhead per unit allocated to Product M using activity-based costing (ABC)? Select one: a. none of the given answer. b. $2.33. c. $1.79. d. $1.83. e. $2.27.

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A:

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A:

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Manufacturing Costs

Manufacturing cost is the total cost of procuring or producing a product. In other words, the manufacturing cost is the cost that an individual or business owner undertakes for the manufacturing of goods.