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Cedar Crest College Operations And Supply Chain Management Assignment Help - Daffodil Company

Question - Daffodil Company produces two products, Flower and Planter. Flower is a high-volume item totaling 20,000 units annually. Planter is a low-volume item totaling only 6,000 units per year. Flower requires one hour of direct labor for completion, while each unit of Planter requires 2 hours. Therefore, total annual direct labor hours are 32,000 (20,000 + 12,000). Expected annual manufacturing overhead costs are $640,000. Sphere uses a traditional costing system and assigns overhead based on direct labor hours. Each unit of Planter would be assigned overhead of (a) $20.00. (b) $24.61. (c) $40.00. (d) Need more information to compute.

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