Cost Allocation Methods What Are They, Types
The calculation of a product’s cost involves threecomponents—direct materials, direct labor, and manufacturingoverhead. Assume direct materials cost $1,000 for one unit of theBasic sailboat and $1,300 for the Deluxe. Direct labor costs are$600 for one unit of the Basic sailboat and $750 for the Deluxe.This information, combined with the overhead cost per unit, givesus what …