In: Economics
Annual manufacturing cost data (1000s) for four product lines are as follows:
Data |
Line 1 |
Line 2 |
Line 3 |
Line 4 |
Annual production |
4000 |
2500 |
9800 |
675 |
Cost of direct materials |
$800 |
$650 |
$1200 |
$2500 |
Cost of direct labor |
$3500 |
$3750 |
$600 |
$320 |
Rank the product lines from lowest to highest in terms of manufacturing cost per unit. Total indirect costs of $10,8 million are allocated based on total direct cost. (Please show work)
Ranking is 3-1-2-4
The excel calculation and formula used are shown below:
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