Following changes ax40 ex90 direct materials cost per

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following changes: AX40 EX90 Direct materials cost per unit has changed for both products. $32.00 $50.00 The new union contract that the company signed at the end of last year increased labor costs for both models ($13.00 per hr.). $9.75
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$13.00 The direct labor hours per unit has not changed. 0.75 hr. 1.0 hr. 4. Due to the increase in demand for the EX90 product, production will increase next year. The production for AX40 will remain the same. 40,000 11,000 5. The company has made several improvements over the past year to improve efficiency and lower costs for the popular EX90 product. The following estimated overhead costs have changed for next year: Estimated Overhead Cost Expected Activity AX40 EX 90 LUSU LA U Maintaining parts inventory* $164,925 Processing purchase orders $ 91,800 Quality control** $190,000 Machine related*** $459,900 75 800 2,000 4,000 150 220 2,750 7,700 *The company has changed to a computer based inventory management system which has improved the efficiency and lowered the overall cost of managing the parts inventory. **Improvements in production efficiency reduced the number of tests run on the AX40 and EX90 models thus lowering the total cost of quality control. ***Engineering improvements has reduced the amount of machine time needed to produce the EX90. Your spreadsheets should automatically recalculate using the new data. You should not have to change any of the cell references or formulas for either of your statements. (If you do then you have done the cell referencing incorrectly.) You are only changing the Data Block area (the highlighted area).
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