FUND.ACCT.PRIN.-CONNECT ACCESS
FUND.ACCT.PRIN.-CONNECT ACCESS
25th Edition
ISBN: 9781264217021
Author: Wild
Publisher: MCG
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Chapter C, Problem 2PSA

Requirement 1:

To determine

Determine the overhead cost to be assigned to each pup tent and each pop-tent using plantwide overhead rate based on direct labor hours.

Requirement 2:

To determine

Compute the total cost per unit for both products if the direct materials and direct labor cost is $25 per pup tent and $32 per pop-up tent.

Requirement 3:

To determine

Compute the gross profit per unit for each tent if the market price of pup tent is $65 and $200 for pop-tent and determine what might management conclude about the pup tent?

Requirement 4:

To determine

Compute the total cost per unit of each tent if the direct labor and direct materials cost is $25 per pup tent and $32 per pop-up tent using ABC.

Requirement 5

To determine

Using ABC results, determine the gross profit per unit of each tent if the market price is $65 per pup tent and $200 per pop-up tent and suggest whether each product line would be profitable or not.

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