3. Babes Company accumulated the following cost information for ittwo products, BB and CC.Product BBProduct CCProduction volumeTotal direct labor hours2,0005,000P1,0001,00020,000P2,000Set up cost per batchBatch size10050Total setup cost incurredDirect labor hour cost per unitP20,000P40,00021A traditional costing system would allocate setup costs on the basisof direct labor hours. An ABC system would trace costs by spreadingthe cost per batch over the units in a batch.What is the setup cost per unit of Product BB under each costingsystem?Traditional CostingP 4.80P 2.40P10.00P 4.80АВСP40.00P10.00P10.00P20.00a.b.c.d. Under the two methods of costing, the cost per unit for productsystem, which applies manufacturing overhead on the basis of5. Believing that traditional costing system provides misleadingSweet Company plans on using 50,000 direct labor hours and 30,000machine hours in the coming year. The following data show theinformation, Sweet Company is considering a shift to activity-basedcosting (ABC) approach. At present, the company is using full cost290Chaptermachine hours.manufacturing overhead that is budgeted:ActivityCost DriverBudgeted Activity Budgeted ConMaterials handling No.of parts handledSetup costsMachining costsQuality control6,000,000P720,000315,000No. of setups75030,000Machine hoursNo. of batches540,000500225,000Cost, sales, and production data for one of the company's product forthe coming year are as follows:Prime Costs:Direct material cost per unitsDirect labor cost per unit, .05 direct labor hour @ P15 per hourP4400.75Sales and production data:Expected salesBatch sizeSetupsTotal parts per finished unitMachine hours required20,000 units5,000 units2. per batch5 partsbatch80 machine hours perdescribed for the coming year will be:Traditional CostingP5.39P5.44P6.11P6.95АВСP6.00P6.08P6.30P6.30a.b.с.d.

Here in this question we are required to calculate set up cost per unit if product BB under…

Answered: 3. Babes Company accumulated the…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A company which uses activity-based costing has two products: A and B. The annual production and sales of Product A is 12,000 units and of Product B is 10,500 units. There are three activity cost pools, with total cost and total activity as follows: Total Activity Product Product A Activity Cost Pool Total Cost Total Activity 1 Activity 2 Activity 3 52-54 $25,420 130 490 620 $38,400 $122,670 890 310 1,200 820 3,410 4,230 The activity-based costing cost per unit of Product A is closest to: (Round your intermediate calculations to 2 decimal places.) Multiple Choice $10.79 $1.60 $4.80 $3.10
Bruce Corporation makes four products in a single facility. These products have the following unit product costs: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead. Unit product cost Additional data concerning these products are listed below. Multiple Choice Product C Product B Product D Product A Products A B C D $17.20 $ 21.10 $ 14.10 $ 16.80 19.20 22.60 17.00 11.00 6.00 7.20 29.10 16.00 $71.50 A 2.25 $ 86.70 $ 2.95 4,600 9.70 16.10 $66.90 $ 56.90 Products Grinding minutes per unit Selling price per unit Variable selling cost per unit Monthly demand in units. The grinding machines are potentially the constraint in the production facility. A total of 10,500 minutes are available per month on these machines. Direct labor is a variable cost in this company. Which product makes the MOST profitable use of the grinding machines? Note: Round your intermediate calculations to 2 decimal places. B 1.30 $ 79.10 $ 3.65 3,600 C 0.85 $ 75.90 $4.40 3,600
Using this information from Planters, Inc., what is the cost per unit under variable costing? Round to the nearest penny, two decimal places. Planters, Inc data Cost Production Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Amount 11,808 units $231 271 105 1,150,457
Doles Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products. Activity Cost Pools Setting up batches Processing customer orders Assembling products Data concerning two products appear below: Number of batches Number of customer orders Number of assembly hours Total overhead cost Activity Rate $69.22 per batch $26.28 per customer order $ 12.11 per assembly hour Product K52W 65 45 418 Required: How much overhead cost would be assigned to each of the two products using the company's activity-based costing system? (Round your intermediate calculations and final answers to 2 decimal places.) Product K52W Product X94T Product X94T 52 30 161
Given the following information, determine the product cost of one unit: Direct Materials = $60; Direct labor = $10; Apply Overhead based on $2 per Direct Labor hour; Direct labor hours is 4 hours per unit. a. $70 per unit b. $80 per unit c. $78 per unit d. $85 per unit Contribution margin is sales less: a. Fixed overhead and fixed selling and administrative expenses b. Variable Cost of goods sold and variable selling & administrative expenses c. Variable selling and administrative expemses and Fixed selling and administrative expenses d. variable cost of goods sold An investment generates an operating income of $100,000, and the average operating assets are $400,000. What is the return on the investment? a. 100% b. 75% c. 25% d. 20%
Coronado Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. The traditional and the activity-based costing systems assign the same amount of direct materials and direct labor costs. Products Product 540X Product 137Y Product 249S (a) Sales Revenue $210,000 Product 137Y * Your answer is incorrect. Product 540X $ LA LA 166,000 LA 94,000 Product 249S $ Total Costs Traditional $59,000 For each product line, compute operating income using the traditional costing system. 49,000 17,000 160060 131040 ABC 53900 $49,940 34,960 40,100
Lillibridge & Friends, Incorporated provides you with the following data for its single product: Sales price per unit Fixed costs (per quarter): Selling, general, and administrative (SG&A) Manufacturing overhead Variable costs (per unit): Direct labor Direct materials Manufacturing overhead SG&A Number of units produced per quarter a. Prime cost per unit b. Contribution margin per unit c. Gross margin per unit d. Conversion cost per unit e. Variable cost per unit f. Full absorption cost per unit Required: Compute the amounts for each of the following assuming that the production levels are within the relevant range if the number of units is 500,000 per quarter. Also calculate if the number of units increases to 600,000 per quarter. Note: Round your answers to 2 decimal places. g. Variable production cost per unit h. Full cost per unit 500,000 units $ $ S $ 50 1,500,000 4,500,000 600,000 units $ 19.00 17.00 $ 13.00 $ 8 11 9 5 500,000 units 19.00 17.00 14.50
A standard cost card for one unit of a product may look like the following: Direct materials (4 pounds @ $1.25 per pound) $5.00 Direct labor (0.1 DLH @ $18 per hour) 1.80 Variable overhead (0.1 DLH @ $2.00 per hour) 0.20 Fixed overhead (0.1 DLH @ $4.60 per hour) 0.46 Total cost per unit $7.46 The standard cost to produce one unit is $7.46. The standard cost to produce 600 units are $ Of course, this is a simplification as the standard cost does not take fixed and variable costs into account. However, if the firm is producing at or near capacity, then the cost per unit of $7.46 could be multiplied by total units to get total standard cost. The standard cost card gives both unit and cost standards. The direct materials total of $5.00 is based on the use of four pounds of material at $1.25 per pound. Similarly, it should take six minutes (0.1 direct labor hour) to produce one unit. This makes it easy to determine total quantities and cost would be for multiple units. If 400 units were…
Survivor Corporation produced 8,500 units and incurred the following cost: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Sales commissions Variable administrative expense Fixed selling and administrative expense Determine the following: 1. Total direct manufacturing cost = 2. Total indirect manufacturing cost = Cost per Unit P 5.00 P 3.20 P 1.30 P 1.10 P 0.30 Cost per Period P 127,500 P 38,250
Lillibridge & Friends, Incorporated provides you with the following data for its single product: Sales price per unit Fixed costs (per quarter): Selling, general, and administrative (SG&A) Manufacturing overhead Variable costs (per unit): Direct labor Direct materials Manufacturing overhead SG&A Number of units produced per quarter a. Prime cost per unit b. Contribution margin per unit c. Gross margin per unit d. Conversion cost per unit e. Variable cost per unit f. Full absorption cost per unit g. Variable production cost per unit h. Full cost per unit 500,000 units $50 1,500,000 4,500,000 Required: Compute the amounts for each of the following assuming that the production levels are within the relevant range if the number of units is 500,000 per quarter. Also calculate if the number of units increases to 600,000 per quarter. Note: Round your answers to 2 decimal places. 8 600,000 units 11 9 5 500,000 units
Senff Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products: Activity Cost Pools Setting up batches Processing customer orders Assembling products Data concerning two products appear below: Number of batches Number of customer orders Number of assembly hours Activity Rate $ 82.25 per batch $ 73.65 per customer order $ 9.01 per assembly hour Product V91Z 76 21 493 Product V211 13 10 698 How much overhead cost would be assigned to Product V91Z using the activity-based costing system? (Round your intermediate calculations to 2 decimal places.)
A company has the following overhead costs and activities: Estimated Expected Activity Product V Product W Product X Overhead Activities and Activity Measures Machine setups (setups) Processing customer orders (orders) Assembling products (assembly-hours) $9,178.00 Cost S7,234.50 $3,565.50 69 12 10 20 21 492 697 111 4. A company sells two products, one with sales of $10,000 and variable expenses of $2,500, another with sales of $46,000 and variable expenses of $15,420. Fixed expenses are $33,100. Breakeven point for the whole company is close to: А. 833,100 В. $22,900 C. $51,020 D. $48,676 A company that reduces the proportion of variable costs in its cost structure will: A. enjoys higher stability in profits. B. increase its profits more when the economy is good. C. have a loss more easily when the economy is bad. D. be indifferent. 5. 6. is normally recorded on any financial statement but irrelevant in decision making which is not. A. Sunk cost B. Incremental cost C. Differential…

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