Reference no: EM132959486
Question - A company has the following data for the year:
Estimated company overhead $500,000
Estimated direct labor dollars $1,000,000
Estimated machine hours $250,000
Actual factory overhead $550,000
Actual direct labor dollars $1,100,000
Actual machine hours $270,000
Product A takes 3 machines hours and $20 of direct labor dollars,
Required - How much will the cost per unit of product X increase if the company changes from allocating overhead based on machines hours to direct labor hours?
a. $3.54
b. $3.89
c. $4.00
d. $4.40
e. $3.54
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