Cane Company manufactures two products called Alpha and Beta that sell for $125 and $85, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 101,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Alpha Beta $ 30 $ 12 21 20 8 6 11 17 19 13 9 16 11 $ 105 $77 Required: 1. What is the total amount of traceable fixed manufacturing overhead for each of the two products? Traceable fixed manufacturing overhead Alpha Beta
Cane Company manufactures two products called Alpha and Beta that sell for $125 and $85, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 101,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. Alpha Beta $ 30 $ 12 21 20 8 6 11 17 19 13 9 16 11 $ 105 $77 Required: 1. What is the total amount of traceable fixed manufacturing overhead for each of the two products? Traceable fixed manufacturing overhead Alpha Beta
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Cane Company manufactures two products called Alpha and Beta that sell for $125 and $85, respectively. Each product
uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 101,000
units of each product. Its average cost per unit for each product at this level of activity are given below:
Direct materials
Direct labor
Variable manufacturing overhead
Traceable fixed manufacturing overhead
Variable selling expenses
Common fixed expenses
Total cost per unit
Alpha
$ 30
21
8
Traceable fixed manufacturing overhead
17
13
16
$ 105
Alpha
Beta
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses
are unavoidable and have been allocated to products based on sales dollars.
$12
20
Required:
1. What is the total amount of traceable fixed manufacturing overhead for each of the two products?
Beta
19
9
11
$ 77](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff1683b51-cba0-4717-980b-d7f8cb304f6e%2F99d71358-fb4a-4357-9d4d-fc42193f75d9%2Fy7wk1uf_processed.png&w=3840&q=75)
Transcribed Image Text:Cane Company manufactures two products called Alpha and Beta that sell for $125 and $85, respectively. Each product
uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 101,000
units of each product. Its average cost per unit for each product at this level of activity are given below:
Direct materials
Direct labor
Variable manufacturing overhead
Traceable fixed manufacturing overhead
Variable selling expenses
Common fixed expenses
Total cost per unit
Alpha
$ 30
21
8
Traceable fixed manufacturing overhead
17
13
16
$ 105
Alpha
Beta
The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses
are unavoidable and have been allocated to products based on sales dollars.
$12
20
Required:
1. What is the total amount of traceable fixed manufacturing overhead for each of the two products?
Beta
19
9
11
$ 77
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