Determine the gross profit per unit for product

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Reference no: EM132083251

Question: Walnut Systems produces two different products, Product A, which sells for $130 per unit, and Product B, which sells for $201 per unit, using three different activities: Design, which uses Engineering Hours as an activity driver; Machining, which uses machine hours as an activity driver; and Inspection, which uses number of batches as an activity driver. The cost of each activity and usage of the activity drivers are as follows: Cost Usage by Product A Usage by Product B Design (Engineering Hours) $ 165,880 200 320 Machining (Machine Hours) $ 531,200 1,080 3,070 Inspection (Batches) $ 23,800 41 15 Walnut manufactures 10,400 units of Product A and 7,900 units of Product B per month. Each unit of Product A uses $46 of direct materials and $11 of direct labor, while each unit of Product B uses $68 of direct materials and $32 of direct labor.

Required: a. Calculate the activity rate for design.

b. Calculate the activity rate for machining.

c. Calculate the activity rate for inspection.

d. Determine the indirect costs assigned to Product A.

e. Determine the indirect costs assigned to Product B.

f. Determine the manufacturing cost per unit for Product A. (Round your answer to 2 decimal places.)

g. Determine the manufacturing cost per unit for Product B. (Round your answer to 2 decimal places.)

h. Determine the gross profit per unit for Product A. (Round your intermediate calculation to 2 decimal places. Round your answer to 2 decimal places.)

i. Determine the gross profit per unit for Product B. (Round your intermediate calculation to 2 decimal places. Round your answer to 2 decimal places.)

Reference no: EM132083251

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