Ramsey Company produces speakers number 2 hmw.docx - Ramsey Company produces speakers(Model A and Model B Both products pass through two producing

Ramsey Company produces speakers number 2 hmw.docx - Ramsey...

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Ramsey Company produces speakers (Model A and Model B). Both products pass through two producing departments. Model A's production is much more labor-intensive than that of Model B. Model B is also the more popular of the two speakers. The following data has been gathered for the two products: Product Data Model A Model B Units produced per year 10,000 100,000 Prime costs $153,000 $1,530,000 Direct labor hours 143,000 310,000 Machine hours 21,000 196,000 Production runs 40 60 Inspection hours 900 1,300 Maintenance hours 8,000 92,000 Overhead costs: Setup costs $300,000 Inspection costs 209,000 Machining 318,200 Maintenance 260,000 Total $1,087,200 Required: 1. Compute the overhead cost per unit for each product by using a plantwide rate based on
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Product Data direct labor hours. (Round to two decimal places.) 2. Compute the overhead cost per unit for each product by using ABC. (Round rates and unit overhead cost to two decimal places.) 3. Suppose that Ramsey decides to use departmental overhead rates. There are two departments: Department 1 (machine intensive) with a rate of $3.90 per machine hour and Department 2 (labor intensive) with a rate of $1.20 per direct labor hour. The
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