a company produces two products product A product B Directmaterials 10000 17000

Q: a company produces two products product A product B Directmaterials 10000 17000

Per Unit Cost ============ Product A Product B Direct materials $10,000 $17,000 Direct labor $8,000 $20,000 Indirect costs $60,000 x $8000/$28000 $17,143 $60,000 x $20000/$28000 $42,857 Total cost $35,143 $79,857 Total units produced 300 600 Cost per unit $117.143 $133.095 ________________________________________________

ID: 2435846 • Letter: A

Question

a company produces two products
product A product B
Directmaterials 10000 17000 Direct labor $8000 $20000 the comany's indirect costs of60000are allocated based on direct labor cost. Assume 300 units of product A and600units of Product B are produced What is te cost per unit for product A?

Explanation / Answer

Per Unit Cost
============
                                        Product A              Product B
Direct materials                  $10,000                  $17,000
Direct labor                          $8,000                  $20,000
Indirect costs
$60,000 x $8000/$28000      $17,143
$60,000 x $20000/$28000                                 $42,857
Total cost                            $35,143                 $79,857
Total units produced                300                        600
Cost per unit                 $117.143              $133.095
________________________________________________

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a company produces two products product A product B Directmaterials 10000 17000

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