Joe’s Fishery manufactures two products, Brown and yellow, for which the followinginformation is available.Maroon GoldUnits Produced 2,600 17,775Target Selling Price $ 240 $ 110Manufacturing CostPer UnitDirect Material $ 78 $ 36Direct Labor $ 42 $ 24Manufacturing Overhead ? ?Total ManufacturingCost Per Unit ? ?Direct Labor Hours Per Unit: 2 (brown) 2 (yellow)The company uses a traditional costing system, with total estimated manufacturing overhead of$815,000 applied to the two products on the basis of direct labor hours.a) Calculate the gross margin per unit of the Brown product under the current, traditional cost systemb) Assume that actual manufacturing overhead costs were $895,000and actual direct labor hours were 52,000. How much is over/underapplied overhead?
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