Reference no: EM132789768
Nole, Inc., manufactures and sells two products: Product W8 and Product
No. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appears below:
Expected Production Direct Labor-Hours Per Unit Total Direct Labor-Hours
Product W8 100 9.0 900
Product N0 1,000 11.0 11,000
Total direct labor-hours 11,900
The direct labor rate is $17.40 per DLH. The direct materials cost per unit for each product is given below:
Direct Materials Cost per Unit
Product W8 $176.40
Product N0 $280.50
The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Activity Cost Pools Activity Measures Estimated Overhead Cost Product W8 Product No total
Labor-related DLHs $461,720 900 11,000 11,900
Machine orders 25,865 300 400 700
order size MHs 796,220 4,000 4,200 8,200
$1,283,805
Problem 1: The overhead applied to each unit of Product W8 under activity-based costing is closest to:
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