What is the setup cost per unit of product b

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Question - Nyang-Nyang Inc. accumulated the following cost information for its two products, A and B.

Product A Product B

Units produced 2,000 1,000

Total direct labor hours 5,000 20,000

Set-up cost per batch P1,000 P2,000

Batch size 100 50

Total set-up cost incurred P20,000 P40,000

Direct labor hour per unit 2 1

A traditional costing system would allocate setup costs on the basis of direct labor hours. An ABC system would trace costs by spreading the cost per batch over the units in a batch.

Required -

a. What is the setup cost per unit of Product A under Traditional Costing?

b. What is the setup cost per unit of Product A under Activity-Based Costing?

c. What is the setup cost per unit of Product B under Traditional Costing?

d. What is the setup cost per unit of Product B under Activity-Based Costing?

Reference no: EM132532027

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