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A manufacturing plant you consult at makes two products (ADA and ETH) and is considering switching to ABC. The following information is available:

A manufacturing plant you consult at makes two products (ADA and ETH) and is considering switching to ABC. The following information is available:







ADAETH


Direct materials per unit $                      35.25 $     25.55


Direct labor per unit $                      16.10 $     39.10


Direct labor-hours per unit0.91.8


Annual production35,00015,000








Estimated total manufacturing overhead
 $           1,727,600

Estimated total direct labor-hours
28000







Activities and Activity Measures




Assembling products (DLHs) $                708,000



Preparing batches (batches) $                297,600



Axial milling (MHs) $                722,000



Total $           1,727,600









                                                         ADA    ETH           Total

Assembling products19,50015,00034,500

Preparing batches8521,5642,416

Axial milling2569851,241













Calculate the manufacturing overhead cost per unit of each product under the

a) using traditional costing system.



b) using activity-based costing system.




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