The accounting records for Portland Products report the following manufacturing

Question

The accounting records for Portland Products report the following manufacturing costs for the past year Direct materials Direct labor Variable overhead $ 340,000 268,000 236,000 Production was 180,000 units. Fixed manufacturing overhead was $830,000. For the coming year, costs are expected to increase as follows: direct materials costs by 20 percent, excluding any effect of volume changes; direct labor by 4 percent; and fixed manufacturing overhead by 10 percent. Variable manufacturing overhead per unit is expected to remain the same Required a. Prepare a cost estimate for a volume level of 144,000 units of product this year. (Do not round intermediate computations.) Answer is complete but not entirely correct. Cost Item Direct materials Direct labor Variable overhead Fixed overhead Total costs 408,000 278,720 188,640 913,000 1,788,360 b. Determine the costs per unit for last year and for this year. (Round your answers to 2 decimal places.) Answer is complete but not entirely correct. Costs Per Last year This year 9.30 2.41

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Cost item This years cost Direct materials ($340,000/180,000*144,000)*120%) $              326,400 Direct labor ($268,000/180,000*144,000)*104%) $              222,976 Variable overhead ($236,000/180,000*144,000) $              188,800 Fixed overhead $              913,000 Total cost $          1,651,176

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