Rice Inc. manufactures lawn mowers and garden tractors. Lawn mowers are relativ

Rice Inc. manufactures lawn mowers and garden tractors. Lawn mowers are relatively simple to produce and are made in large quantities. Garden tractors are
customized to individual wholesale customer specifications. The company sells 300000 lawn mowers and 30000 garden tractors annually. Revenues and costs
incurred for each product are as follows:
Law Mower Garden Tractors Rev $19500000 $17850000 DM 4000000 2700000 DL ($20/Hr) 2800000 6000000 Overhead ? ?
Manufacturing overhead totals $3960000 and administrative expenses equal $7400000.
a. Calculate the profit (loss) in total and per unit for each product if overhead is assigned to product using a per-unit basis.
b. Calculate the profit (loss) in total and per unit for each product if overhead is assigned to products using a direct labor hour basis.
c. Assume that manufacturing overhead can be divided into two cost pools as follows: $1320000 which has a cost driver of direct labor hours and $2640000
which has a cost driver of machine hours (totaling 150000). Lawn mower production uses 25000 machine hours; garden tractor production uses 125000 machine
hours. Calculate the profit (loss) in total and per unit for each product if overhead is assigned to products using these two overhead bases.
d. Does your answer in (a) (b) or (c) provide the best representation of the profit contributed by each product?Explain.