Exam 3: Activity-Based Costing and Other Cost Management Tools

Brannon Company manufactures ceiling fans and uses an activity-based costing system. Each ceiling fan consists of 20 separate parts totaling $95 in direct materials, and requires 2.5 hours of machine time to produce. Additional information follows: -What is the total manufacturing cost per ceiling fan?

Crump Manufacturing has provided the following information regarding its activity-based costing system: .Purchasing department costs are allocated based on purchase orders and the cost allocation rate is $52 per purchase order. .Assembly department costs are allocated based on the number of machine hours and the cost allocation rate is $27 per machine hour. .Inspection department costs are allocated based on the number of inspection hours and the allocation rate is $39 per inspection hour. Each unit produced has a direct materials cost of $70 and a direct labor cost of $65. Crump has an Order for 500 units which will require 40 purchase orders, 750 machine hours, and 50 inspection hours. - What is the selling price per unit assuming that Crump adds a 40% markup to total cost?