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Innova uses 1,014 units of the component IMC2 every month to

    Innova uses 1,014 units of the component IMC2 every month to manufacture one of its products. The unit costs incurred to manufacture the component are as follows.Direct materials$57.00Direct labor40.00Overhead126.50Total$223.50Overhead costs include variable material handling costs of $7.30, which are applied to products on the basis of direct material costs. The remainder of the overhead costs are applied on the basis of direct labor dollars and consist of 60% variable costs and 40% fixed costs.

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