Past exam paper

Triple Limited makes three types of gold watch-the Diva (D), the Classic (C) and the Poser (P). A traditional product costing system is used at present; although an activity based costing (ABC) system is being considered. Details of the three products for a typical period are: Hours per unit Materials Production Labour hours Machine hours Cost per unit ($) Units Product D 1/2 1.5 20 1,750 Product C 1.5 1 12 1,250 Product P 1 3 25 7,000 Direct labour costs $6 per hour and production overheads are absorbed on a machine hour basis. The overhead absorption rate for the period is $28 per machine hour. Required: (a) Calculate the cost per unit for each product using traditional methods, absorbing overheads on the basis of machine hours. (a) Traditional cost per unit D C P Material 20 12 25 Labour ($6/hour) 3 9 6 Direct costs 23 21 31 Production overhead ($28/machine hour) 42 28 84 Total production cost /unit 65 49 115 Don't know how he got $42 production overheads as labour hrs per unit is 1*1/2=0.5 Can you please help