Calculate unit costs under activity based costing

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Question - Atlas Company produces two automobile antitheft devices:

The Boot: a high volume item with sales totaling 25,000 per year

The Club: a low volume item with sales totaling 5,000 per year

Each product requires 1 hour of direct labor

Total annual direct labor hours (DLH) 30,000 (25,000 + 5000)

Direct labor cost $12 per unit for each product Expected annual manufacturing overhead costs $900,000

Direct materials cost: The Boot - $40 per unit

The Club - $30 per unit

Identify the steps in the development of an activity-based costing system.

Calculate unit costs under Activity Based Costing.

Reference no: EM133085506

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