Rocky mountain corporation makes two types of hiking boots-

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Reference no: EM13605187

Rocky Mountain Corporation makes two types of hiking boots- Xactive and Pathbreaker, data concerning these two product lines appear below:

Xactive Pathbreaker

selling price per unit $127 $89

direct materials per unit $64.80 $51

direct labor per unit $18.20 $13

direct labor-hours per unit 1.4 DLHs 1.0DLHs

Estimated annual production and sales 25,000 unnits 75,000 units

The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct-labor hours for the upcoming year appear below:

Estimated total manufacturing overhead...................... $2,200,000

estimated total direct labor-hours............................ 110,000 DLHs

1. Compute the product margins for the Xactive and the Pathbreaker products under the company's traditional costing system.

Reference no: EM13605187

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