Trauscht Corporation has provided the following data form its activity based cos

Question

Trauscht Corporation has provided the following data form its activity based costing system Activity cost pool, Assembly total cost $704,880, total activity, 44,000 machine hours, processing ordrs total cost $91,428 total activity 1,900 orders, and inspection cost $117,546 with total activity being 1,950 inspection hours. The company makes 360 units of product P23F a year, requiring a total of 725 machine hours, 85 orders, and 45 inspection hours per year. The products sells for $132.10 per unit. Accourding to the activity based costing system what is th eproduct margin for product P23F?

PLease show me how to get the answer as I need to show my work

Thank You

Explanation / Answer

No. of units = 360 Assembly cost per unit = ((725/360)/44000)*704880 = $32.2625 Processing cost per unit = ((85/360)/1900)*91428 = $11.3617 Inspection cost per unit = ((45/360)/1950)*117546 = $7.535 In questions direct material cost and labor cost are not given. Let Direct material cost = x And Labor cost = y Then Product margin = $(132.1 - x - y - 32.2625 - 11.3617 - 7.535) = $(80.9408-x-y) Substitute for x and y to get final answer. Thank You!!!!!

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