Question

Larner Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains the following six activity cost pools and activity rates:

Activity Cost Pool	Activity Rates
Labor-related	$	7.00	per direct labor-hour
Machine-related	$	7.00	per machine-hour
Machine setups	$	30.00	per setup
Production orders	$	200.00	per order
Shipments	$	140.00	per shipment
General factory	$	7.00	per direct labor-hour

Cost and activity data have been supplied for the following products:

J78				B52
Direct materials cost per unit	$	5.50			$	32.00
Direct labor cost per unit	$	4.75			$	9.00
Number of units produced per year		4,000				100

	Total Expected Activity
		J78			B52
Direct labor-hours		1,200			30
Machine-hours		2,200			50
Machine setups		6			1
Production orders		5			1
Shipments		7			1

Required:

Compute the unit product cost of each product listed above. (Do not round intermediate calculations. Round your answers to 2 decimal places.)

	J78	B52
Unit Product Cost

Answer 1

	J78	B52
Mat	5.50	32.00
Lab	4.75	9.00
Overhead	8.59	11.40
Unit product cost	18.84	52.40
Note 1: Overhead allocation sheet
		J78	B52
Activity	OH Rate	Driver Incurred	OH Cost assigned	Driver Incurred	OH Cost assigned
Labor-related	7.00	1,200	8,400	30	210
Machine-related	7.00	2,200	15,400	50	350
Machine setups	30.00	6	180	1	30
Production orders	200.00	5	1,000	1	200
Shipments	140.00	7	980	1	140
General factory	7.00	1,200	8,400	30	210
Total			34,360		1,140
No. of Units			4,000		100
Overhead per unit			8.59		11.40