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308 Chapter 9 30. Carnation Company has two products: A and B. The company uses. The estimated activity-based costing to determine product costs. overhead costs and expected activity for each of the company's three overhead activity centers are as follows: Estimated Activity Overhead Expected Activity Product A Total Product B Centerbrit Costs 700 300 1,000 Activity I P32,600 200 600 800 P17,600 Activity 2 P52,500 400 500 Activity 3 100 The predetermined overhead rate under the activity based costing system for Activity 3 is closest to: a. P525.00. C. P105.00. b. P 44.65. 27d. P205.00.

308 Chapter 9 30. Carnation Company has two products: A and B. The company uses. The estimated activity-based costing to determine product costs. overhead costs and expected activity for each of the company's three overhead activity centers are as follows: Estimated Activity Overhead Expected Activity Product A Total Product B Centerbrit Costs 700 300 1,000 Activity I P32,600 200 600 800 P17,600 Activity 2 P52,500 400 500 Activity 3 100 The predetermined overhead rate under the activity based costing system for Activity 3 is closest to: a. P525.00. C. P105.00. b. P 44.65. 27d. P205.00.

FINANCIAL ACCOUNTING
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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308 Chapter 9 30. Carnation Company has two products: A and B. The company uses. The estimated activity-based costing to determine product costs. overhead costs and expected activity for each of the company's three 100/1 overhead activity centers are as follows: Estimated Activity Overhead Expected Activity Product A Product B Total Center nebri Costs 700 300 1,000 P32,600 Activity I 600 200 800 P17,600 Activity 2 400 100 500 P52,500 Activity 3 The predetermined overhead rate under the activity based costing system for Activity 3 is closest to: a. P525.00. C. P105.00. P205.00. b. P 44.65. d. V. Problems Problem 1 Peejay Autoparts, Inc., previously used a cost system that allocated all factory overhead costs to products based on 350 percent of direct labor cost. The company has just implemented an ABC system that traces indirect costs to products based on consumption of major activities as indicated below. Compare the total annual costs of Product X using both the traditional volume-based and the new ABC systems. Annual Cost Driver Activity Quantity Cost Product X Cost Driver Consumption Labor P300,000 P 30,000 Machining 20,000 hours P10,000 800 hours Setup P500,000 10,000 hours P100,000 100 hours
Transcribed Image Text:308 Chapter 9 30. Carnation Company has two products: A and B. The company uses. The estimated activity-based costing to determine product costs. overhead costs and expected activity for each of the company's three 100/1 overhead activity centers are as follows: Estimated Activity Overhead Expected Activity Product A Product B Total Center nebri Costs 700 300 1,000 P32,600 Activity I 600 200 800 P17,600 Activity 2 400 100 500 P52,500 Activity 3 The predetermined overhead rate under the activity based costing system for Activity 3 is closest to: a. P525.00. C. P105.00. P205.00. b. P 44.65. d. V. Problems Problem 1 Peejay Autoparts, Inc., previously used a cost system that allocated all factory overhead costs to products based on 350 percent of direct labor cost. The company has just implemented an ABC system that traces indirect costs to products based on consumption of major activities as indicated below. Compare the total annual costs of Product X using both the traditional volume-based and the new ABC systems. Annual Cost Driver Activity Quantity Cost Product X Cost Driver Consumption Labor P300,000 P 30,000 Machining 20,000 hours P10,000 800 hours Setup P500,000 10,000 hours P100,000 100 hours
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