Allure 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 Production setups Material handling Packaging costs Cost Driver Number of setups Number of parts Number of units Amount $ 73,000 M XY 12 18 56 93,000 24 62,000 53,000 230,500 $ 356,500 What is the total overhead per unit allocated to Product XY using activity-based costing (ABC)? Note: Do not round intermediate calculations; round your final answer to the nearest cent.
Allure 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 Production setups Material handling Packaging costs Cost Driver Number of setups Number of parts Number of units Amount $ 73,000 M XY 12 18 56 93,000 24 62,000 53,000 230,500 $ 356,500 What is the total overhead per unit allocated to Product XY using activity-based costing (ABC)? Note: Do not round intermediate calculations; round your final answer to the nearest cent.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Allure 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
Production setups
Material handling
Packaging costs
Cost Driver
Number of setups
Number of parts
Number of units
Amount
$ 73,000
M
XY
12
18
56
93,000
24
62,000
53,000
230,500
$ 356,500
What is the total overhead per unit allocated to Product XY using activity-based costing (ABC)?
Note: Do not round intermediate calculations; round your final answer to the nearest cent.
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