Destin Brass Products Co

Destin Brass Products Co.

1) Estimated Product costs per unit:

Number of Units | 7500 |   | 12500 |   | 4000 |

  | Valves |   | Pumps |   | Flow Controllers |

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Material Overhead |   |   |   |   |   |

Receiving | $600.00 |   | $3,800.00 |   | $15,600.00 |

Materials Handling | $6,000.00 |   | $38,000.00 |   | $15,600.00 |

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Manufacturing Overhead |   |   |   |   |   |

Packing and Shipping | $1,800.00 |   | $13,800.00 |   | $43,800.00 |

Engineering | $20,000.00 |   | $30,000.00 |   | $50,000.00 |

Maintenance | $10,500.00 |   | $17,400.00 |   | $2,100.00 |

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Material Related |   |   |   |   |   |

Receiving | $20,000.00 |   |   |   |   |

Materials Handling | $200,000.00 |   |   |   |   |

Machine Depreciation | $270,000.00 | $ 25 | per machine hour |   |   |

Engineering | $100,000.00 |   |   |   |   |

Packing and Shipping | $60,000.00 |   |   |   |   |

Maintenance | $30,000.00 |   |   |   |   |

  |   |   |   |   |   |

 Per Unit |   |   |   |   |   |

Material | $16.00 |   | $20.00 |   | $22.00 |

Receiving | $0.08 |   | $0.30 |   | $3.90 |

Materials Handling | $0.80 |   | $3.04 |   | $3.90 |

Set up labor | $0.02 |   | $0.05 |   | $0.48 |

Direct Labor | $4.00 |   | $8.00 |   | $6.40 |

Machine Depreciation | $12.50 |   | $12.50 |   | $5.00 |

Packing and Shipping | $0.24 |   | $1.10 |   | $10.95 |

Engineering | $2.67 |   | $2.40 |   | $12.50 |

Maintenance | $1.40 |   | $1.39 |   | $0.53 |

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Total | $37.71 |   | $48.79 |   | $65.66 |

2) The different results from the different product costing methods are largely influenced by the allocation and division of Overhead costs in both materials and machine. ABC unit costs breaks out and allocates the Material...