6. The following data are for the two products produced by Johan Company. Product A Product B Direct materials Direct labor hours Machine hours Batches Volume P15 per unit 0.3 DLH per unit 0.1 MH per unit 125 batches 10,000 units 12 modifications 500 customers P30 per unit P24 per unit 1.6 DLH per unit 1.2 MH per unit 225 batches 2,000 units 58 modifications 400 customers P120 per unit Engineering modifications Number of customers Market price The company's direct labor rate is P20 per direct labor hour (DLH). Additional information follows. Costs Driver Indirect manufacturing: Engineering support Electricity Setup costs Nonmanufacturing: Customer service P24,500 Engineering modifications 34,000 52,500 Machine hours Batches 81,000 Number of customers 4. How much gross prorit is generated by each customer of Product A using ABC? How much gross profit is generated by each customer of Product B using ABC? Is the gross profit per customer adequate? 5. Which method of product costing gives better information to managers of this company? Explain why.

6. The following data are for the two products produced by Johan Company. Product A Product B Direct materials Direct labor hours Machine hours Batches Volume P15 per unit 0.3 DLH per unit 0.1 MH per unit 125 batches 10,000 units 12 modifications 500 customers P30 per unit P24 per unit 1.6 DLH per unit 1.2 MH per unit 225 batches 2,000 units 58 modifications 400 customers P120 per unit Engineering modifications Number of customers Market price The company's direct labor rate is P20 per direct labor hour (DLH). Additional information follows. Costs Driver Indirect manufacturing: Engineering support Electricity Setup costs Nonmanufacturing: Customer service P24,500 Engineering modifications 34,000 52,500 Machine hours Batches 81,000 Number of customers 4. How much gross prorit is generated by each customer of Product A using ABC? How much gross profit is generated by each customer of Product B using ABC? Is the gross profit per customer adequate? 5. Which method of product costing gives better information to managers of this company? Explain why.

Name: 6. The following data are for the two products produced by Johan Comp
Uploaded: 2024-03-20T06:32:49.000Z
Channel: Bartleby
Description: 6. The following data are for the two products produced by Johan Company.Product AProduct BP15 per unit0.3 DLH per unit0.1 MH per unit125 batches10,000 units12 modifications500 customersP30 per unitP24 per unit1.6 DLH per unit1.2 MH per unit225 batc

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

AA Appliances manufactures three machines: washers, dryers, and dish washers. Data on the price and costs for the units are shown below. Washers Dryers Dish Washers Price $840.00 $670.00 $500.00 Direct Materials $420.00 $335.00 $250.00 Direct Labor $200.00 $110.00 $70.00 Variable Manufacturing Overhead $80.00 $70.00 $80.00 It is calculated that manufacturing overhead is allocated to the three products using a rate of $10 per machine hour. It is revealed that there are 140 extra machine hours to allocate to produce another product. Do not enter dollar signs or commas in the input boxes. Round all answers to 2 decimal places. a) Calculate the machine hours used per item. Washers Dryers Dish Washers Variable Manufacturing Overhead Answer Answer Answer Over
4
Sanditon Ltd designs and manufactures four products H, I, K and K for the manufacturing industry. Output and cost data for the period just ended are as follows:Output No. of production Material Cost Direct labour Machine hoursruns in the period per unit hours per unit per unitUnits £H 40 4 25 2 2I 70 4 30 3 6J 90 6 80 3 6K 360 8 100 4 422Direct labour cost per hour is £7. Overhead costs are as follows: £Short run variable costs 6,000Set-up costs 10,000Expediting and scheduling costs 8,000Materials Handling Costs 10,00034,000The following cost drivers have been identified:Short run Variable Costs = Production RunsSet up costs = Production RunsExpediting and Scheduling Costs = Machine HoursMaterials Handling Costs = Labour HoursN.B. Machine hours are to be used as the traditional overhead application methodRequired:a) Calculate the product cost using a Traditional and ABC approach.b) Discuss and analyse alternative methods available to businesses of allocating costs.
Required information [The following information applies to the questions displayed below.] Kubin Company's relevant range of production is 18,000 to 22,000 units. When it produces and sells 20,000 units, its average costs per unit are as follows: Average Cost per Unit $ 7.00 $ 4.00 $ 1.50 $ 5.00 $ 3.50 $ 2.50 $ 1.00 $ 0.50 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Required: 1. Assume the cost object is units of production: a. What is the total direct manufacturing cost incurred to make 20,000 units? b. What is the total indirect manufacturing cost incurred to make 20,000 units? 2. Assume the cost object is the Manufacturing Department and that its total output is 20,000 units. a. How much total manufacturing cost is directly traceable to the Manufacturing Department? b. How much total manufacturing cost is an indirect cost that cannot be…
Required information [The following information applies to the questions displayed below.] Kubin Company's relevant range of production is 18,000 to 22,000 units. When it produces and sells 20,000 units, its average costs per unit are as follows: Average Cost per Unit $ 7.00 $ 4.00 $ 1.50 $ 5.00 $ 3.50 $ 2.50 $ 1.00 $ 0.50 Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense
Question Company XYZ is currently producing and selling 100 units. At this level, the total direct materials cost is $500, the total direct labor cost is $600 and the total manufacturing overhead cost is $1,200, which includes $800 fixed manufacturing overhead cost. The company's total selling and administrative expenses are $2,500, which include $1,500 fixed selling and administrative costs. Assume that the company wishes to increase the number of units produced and sold to 102 units, what would be the incremental cost? (rounded to nearest ($) value) Not yet answered Marked out of 0.80 P Flag question O a. 30 O b. 25 O c. 50 O d. None of the given answers O e. 46
The Widget Company produces two types of widgets, Standard and Deluxe. Data related to the two products is presented below. Standard Deluxe Annual production in units 25,000 50,000 Direct material costs $75,000 $150,000 Direct manufacturing labor costs $25,000 $50,000 Direct manufacturing labor-hours 1,250 2,500 Machine hours 12,500 25,000 Number of production runs 25 25 Inspection hours 500 250 Both products pass through Departments A and Department B. The departments’ combined manufacturing overhead costs are: Total Machine Costs $187,500 Setup Costs 60,000 Inspection Costs 52,500 Required: Using Activity Based Costing, Compute the…
GB Inc. produces three products. Production and cost information show the following Model X Model Y Model Z Units Produced 1,000 3,000 6,000 Direct labor hours 2,000 1,000 2,000 Number of inspections 20 30 50 Inspection costs totaled P100,000. Using ABC, inspections costs allocated to each unit of Model X would be:
Saved Jefferson, Inc. produces two different products (Product 5 and Product Z) using two different activities: Machining, which uses machine hours as an activity driver, and Inspection, which uses number of batches as an activity driver. The cost of Machining is $324,000, while the cost of Inspection is $37000. The activity drivers are used as follows: Product 5 Product I Total 5,400 70 Machine hours 3,240 2,160 Number of batches 28 42 What proportion of Inspection activity is used by Product Z? Multiple Cholce 68% 32% 60%
Compute the manufacturing cost per unit for each product.
A 162.