Consider the Following ABC Full Costing Report by the Sacks

Essay

Consider the following ABC Full Costing Report by the Sacks Toy Company, which manufactures
specialty dolls:
Management is considering adding a third product line, the Riana doll. Assume the company obtains sufficient additional capacity to offer this product line that has the following characteristics:
? Uses 50% more materials than the Alissa doll
? Is made on a new, dedicated molding machine
? A week's production would be 12,000 dolls in three batches
? Customers would place two orders per week and there would be no warehousing
? Sales and forecasting costs would be the same as other products
? A team of five employees would produce the product
Required:
a) Estimate the unit-level and full ABC cost of this product.
b) What additional information would you like to have before deciding whether to recommend this product?