Smoky Mountain Corporation makes two types of hiking boots--Xtreme and the Pathfinder. Data concerning these two product lines appear below:
Xtreme Pathfinder
Selling price per unit $140.00 $99.00
Direct materials per unit $72.00 $53.00
Direct labor per unit $24.00 $12.00
Direct labor-hours per unit 2.0 DLHs 1.0 DLHs
Estimated annual production and sales 20,000 units 80,000 units
The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below:
Estimated total manufacturing overhead $1,980,000
Estimated total direct labor-hours 120,000 DLHs
Required:
Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. (Round your intermediate calculations to 2 decimal places.)
Answers: 1
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Smoky Mountain Corporation makes two types of hiking boots--Xtreme and the Pathfinder. Data concerni...
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