Which of the following statements concerning the unit product cost of Product W2 is true?
A)The unit product cost of Product W2 under traditional costing is less than its unit product cost under activity-based costing by $209.06.
B)The unit product cost of Product W2 under traditional costing is greater than its unit product under activity-based costing by $12.41.
C)The unit product cost of Product W2 under traditional costing is greater than its unit product under activity-based costing by $209.06.
D)The unit product cost of Product W2 under traditional costing is less than its unit product cost under activity-based costing by $12.41.

Question

Quizplus · Accepted Answer

Predetermined overhead rate = Estimated total overhead ÷ Total direct labor-hours
= $501,744 ÷ 4,800 DLHs = $104.53 per DLH (rounded)
Computation of traditional unit product cost: 11ea7998_5eba_5170_911b_5ba39e7b427b_TB2627_00_TB2627_00 Computation of activity rates: 11ea7998_5eba_7881_911b_5393df20fa7d_TB2627_00_TB2627_00 Computation of the overhead cost per unit under activity-based costing. 11ea7998_5eba_7882_911b_c1d79a6cdf0b_TB2627_00_TB2627_00 Computation of unit product cost under activity-based costing. 11ea7998_5eba_9f93_911b_c3d3c7bc9f27_TB2627_00_TB2627_00 The difference in unit product costs is: 11ea7998_5eba_9f94_911b_09b94dce24ed_TB2627_00_TB2627_00 The unit product cost of Product W2 under traditional costing is less than its unit product cost under activity-based costing by $12.41.
Reference: CH04-Ref26
Kroll, Inc., manufactures and sells two products: Product A4 and Product T6.Data concerning the expected production of each product and the expected total direct labor-hours (DLHs)required to produce that output appear below: 11ea7998_5eba_c6a5_911b_dfdf9456ffdd_TB2627_00_TB2627_00 The direct labor rate is $21.50 per DLH.The direct materials cost per unit is $212.40 for Product A4 and $295.50 for Product T6.
The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: 11ea7998_5eba_c6a6_911b_b946af0c3f86_TB2627_00_TB2627_00

Which of the Following Statements Concerning the Unit Product Cost