Two-Stage ABC for Manufacturing Assume Sherwin-Williams Company, a large paint manufacturer, has determined the following...
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Two-Stage ABC for Manufacturing Assume Sherwin-Williams Company, a large paint manufacturer, has determined the following activity cost pools and cost driver levels for the latest period:
Activity Cost Pool
Activity Cost
Activity Cost Driver
Machine setup
$990,000
3,000
setup hours
Material handling
840,000
6,000
material moves
Machine operation
200,000
25,000
machine hours
The following data are for the production of single batches of two products, Mirlite and Subdue:
Mirlite
Subdue
Gallons produced
30,000
20,000
Direct labor hours
300
150
Machine hours
650
200
Direct labor cost
$ 12,300
$ 9,500
Direct materials cost
$240,000
$ 110,000
Setup hours
12
10
Material moves
40
25
Determine the batch and unit costs per gallon of Mirlite and Subdue using ABC. (Round your answers to the nearest cent.)
Mirlite $Answer
Subdue $Answer per gallon
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