Tiger Furnishings produces two models of cabinets for home theater components

| August 14, 2017

Problem 6-47 Account Analysis, Two-Stage Allocation, and Product Costing (LO 6-2, 4, 5)Tiger Furnishings produces two models of cabinets for home theater components, the Basic and the Dominator. Data on operations and costs for March follow:Basic Dominator TotalUnits produced 1,100 380 1,480Machine-hours 3,800 3,200 7,000Direct labor-hours 3,800 3,800 7,600Direct materials costs $ 13,000 $ 5,650 $ 18,650Direct labor costs 62,500 37,500 100,000Manufacturing overhead costs 190,600Total costs $ 309,250Tiger Furnishings’s CFO believes that a two-stage cost allocation system would give managers better cost information. She asks the company’s cost accountant to analyze the accounts and assign overhead costs to two pools: overhead related to direct labor cost and overhead related to machine-hours.The analysis of overhead accounts by the cost accountant follows:Manufacturing Overhead OverheadEstimate Cost Pool AssignmentUtilities $ 1,500 Machine-hour relatedSupplies 4,400 Direct labor cost relatedTraining 8,800 Direct labor cost relatedSupervision 22,800 Direct labor cost relatedMachine depreciation 30,000 Machine-hour relatedPlant depreciation 31,500 Machine-hour relatedMiscellaneous 91,600 Direct labor cost relatedRequired:(b) Compute the product costs per unit assuming that Tiger Furnishings uses direct labor costs and machine-hours to allocate overhead to the products. (Do not round the direct-labor cost rate in your intermediate calculations. Round your answers to two decimal places.)

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