Reference no: EM132521969

ABC costing... Ajax Corp produces consumer and professional ovens and operates at capacity. Data related to the two products are presented here:

Question 1: Determine a cost driver for each overhead cost pool and calculate the manufacturing overhead cost per unit for each product?

Question 2: Estimate the manufacturing cost per unit for each product.?

Question 3: Review how might Ajax Corp use the new cost information from its activity-based costing system to better manage its business?

Consumer Professional Actual production in units 25,000 50,000

Direct material costs $62,500 $125,000

Direct manufacturing labor costs $25,000 $50,000

Direct manufacturing labor-hours 1,250 2,500

Machine-hours 20,000 50,000

Number of production runs 50 50

Inspection hours 800 400

Total manufacturing overhead costs are as follows:

Total Machining costs $350,000

Setup costs 117,000

Inspection costs 96,000