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goes with questions 13 and 14 Use the...

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Accounting

goes with questions 13 and 14
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Use the following to answer questions 13 and 14 : Simba Corporation manufactures three products. In the past, Simba has been using a traditional costing system in which manufacturing overhead was applied using a predetermined overhead rate of 150% of direct labor cost. Sensing the traditional costing system was distorting product costs; Simba is considering a switch to an activity-based costing system. Under activity-based costing, manufacturing overhead costs will be assigned to products using three activity cost pools. Information on these cost pools for next year is as follows: Information on a per unit basis for the three products produced by Simba follows: Number of setups 2 3 1 Number of inspections. 1 3 1 Number of machine hours. 4 8 10 Under the traditional costing system currently used by Simba, the total per unit product cost for Model\# 36 is: $1,440 $2,040 $1,140 $900 Under the activity-based costing system proposed by Simba, the total per unit product cost for Model\# 19 is: $934 $1,210 $1,334 $2,144

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