Carriage Manufacturing uses an activity-based costing system…
Carriage Manufacturing uses an activity-based costing system. The company produces Model 21 and Model 22. Information relating to the two products is as follows: Model 21 Model 22 Units produced 24,000 30,000 Machine hours 7,500 8,500 Direct labor hours 8,000 12,000 Material handling (number of moves) 4,000 6,000 Setups 5,000 7,000 The following costs are reported: Material handling $ 40,000 Labor-related overhead 120,000 Setups 60,000 Labor-related overhead costs assigned to Model 21 are