Compute the manufacturing cost per unit of each toaster

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Reference no: EM132502468

PopUp Company produces two types of toasters, basic and deluxe.

For the current period, the company reports the following data:

                                                     Basic Toaster                            Deluxe Toaster

Volume                                          20,000 units                           5,000 units

Machine Hours                                     1,000                              2,400

Batches                                                 315                               125

Engineering Modifications                              20                                50

Prime Costs                                         $20,000                        $30,000

Market Price                                        $25 per unit                    $60 per unit

Costs Driver

Engineering Support $15,900 Engineering Modifications

Electricity 25,000 Machine Hours

Setup costs 33,900 Batches

Question 1) Compute the manufacturing cost per unit of each toaster using the current unit-based approach. Under this system costs are assigned to the toasters on the basis of machine hours.

Reference no: EM132502468

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