Cameron Carts produces three models of push carts, the Economy, the Standard, and the Deluxe

(TCO 5) The MNK Company has gathered the following information for a unit of its most popular
February 11, 2020
Manufacturing companies often use the following three overhead allocation bases
February 11, 2020


Cameron Carts produces three models of push carts, the Economy, the Standard, and the Deluxe. Data on

operations and costs for the month are:

                            Economy   Standard   Deluxe      Total

Machine Hours            8,000       16,000    8,000     32,000

Direct labor hours        4,000       12,000    8,000      24,000

Units Produced            8,000       4,000      1,000      13,000

Direct Material Costs $100,00     $80,00    $30,000 $210,000

Direct Labor Costs    200,00      262,000    138,000 600,000

Manufacturing Overhead Costs                                684,000

Total Costs                                                       $1,494,000

Compute the total cost for each model, assuming Cameron Carts uses:

(a) direct labor hours to allocate overhead costs;

(b) direct labor costs to allocate overhead costs; and

(c) machine hours to allocate overhead costs.

 
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