Reference no: EM13577613

Kunkel Company makes two products and uses a conventional costing system in which a single plantwide predetermined overhead rate is computed based on direct labor-hours. Data for the two products for the upcoming year follow: Mercon Wurcon Direct materials cost per unit $ 13.70 $ 22.30 Direct labor cost per unit $ 6.40 $ 3.60 Direct labor-hours per unit 0.42 0.23 Number of units produced 14,000 90,000 These products are customized to some degree for specific customers. Required: 1. The company's manufacturing overhead costs for the year are expected to be $619,314. Using the company's conventional costing system, compute the unit product costs for the two products. Mercon Wurcon Unit product cost $ $ 2. Management is considering an activity-based costing system in which half of the overhead would continue to be allocated on the basis of direct labor-hours and half would be allocated on the basis of engineering design time. This time is expected to be distributed as follows during the upcoming year: Mercon Wurcon Total Engineering design time (in hours) 2,200 2,200 4,400 Compute the unit product costs for the two products using the proposed ABC system. (Round your final answers to 2 decimal places.) Mercon Wurcon Unit product cost $ $.