# Tiger Furnishings produces two models of cabinets

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 Total Units produced 1,420 440 1,860 Machine-hours 3,300 2,700 6,000 Direct labor-hours 2,900 3,300 6,200 Direct materials costs \$ 16,000 \$ 5,450 \$ 21,450 Direct labor costs 63,500 51,500 115,000 Manufacturing overhead costs 194,510 Total costs \$ 330,960

Tiger 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 Overhead Estimate Cost Pool Assignment Utilities \$ 1,500 Machine-hour related Supplies 4,600 Direct labor cost related Training 9,200 Direct labor cost related Supervision 25,800 Direct labor cost related Machine depreciation 23,000 Machine-hour related Plant depreciation 23,500 Machine-hour related Miscellaneous 106,910 Direct labor cost related

Required:

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.)

Here’s the SOLUTION

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