Question

Cooke Company manufactures two products, Product F and Product G. The company expects to produce and sell 1,400 units of Product F and 1,800 units of Product G during the current year. The company uses activity-based costing to compute unit product costs for external reports. Below are current year data for the company's three activity cost pools.

					Total Activity
Activity Cost Pool	Total Cost				Product F		Product G		Total
Machine setups		$	10,800		80	setups	100	setups	180	setups
Purchase orders		$	77,520		510	orders	1,010	orders	1,520	orders
General factory		$	75,920		2,240	hours	3,600	hours	5,840	hours

Required:

Using the activity-based costing approach, determine the overhead cost per unit for each product.

Answer 1