The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and idle capacity costs):
|
Estimated |
Expected Activity
|
| Activities and Activity Measures |
Overhead Cost |
Xactive |
Pathbreaker |
Total |
| Supporting direct labor (direct labor-hours) |
$ |
977,500 |
45,000 |
70,000 |
115,000 |
| Batch setups (setups) |
|
612,000 |
300 |
210 |
510 |
| Product sustaining (number of products) |
|
700,000 |
1 |
1 |
2 |
| Other |
|
10,500 |
NA |
NA |
NA |
|
|
|
|
|
|
| Total manufacturing overhead cost |
$ |
2,300,000 |
|
|
|
|
|
|
|
|
|
|
|
Compute the product margins for the Xactive and the Pathbreaker products under the activity-based costing system. (Loss amounts should be indicated with a minus sign. Round your intermediate calculations to 2 decimal places and final answers to the nearest dollar amount. Omit the "$" sign in your response.)
|
|
Xactive |
Pathbreaker |
Total |
| Product margin |
$ |
$ |
$ |