7. Garfield Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Activity Budgeted Activity Cost Casting Assembly Inspecting Activity Base $650,000 Machine hours 85,000 Direct labor hours 28,000 Number of inspections Setup 15,750 Number of setups Materials 12,000 Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Entry Dining Total Casting Assembly 7,500 12,500 20,000 2,000 3,000 5,000 Inspecting Setup 500 250 750 150 100 250 Materials 400 300 700 Units produced 5,000 2,500 7,500 a. Determine the activity rate for each activity. b. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product.

7. Garfield Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Activity Budgeted Activity Cost Casting Assembly Inspecting Activity Base $650,000 Machine hours 85,000 Direct labor hours 28,000 Number of inspections Setup 15,750 Number of setups Materials 12,000 Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Entry Dining Total Casting Assembly 7,500 12,500 20,000 2,000 3,000 5,000 Inspecting Setup 500 250 750 150 100 250 Materials 400 300 700 Units produced 5,000 2,500 7,500 a. Determine the activity rate for each activity. b. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product.

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 11E: Lonsdale Inc. manufactures entry and dining room lighting fixtures. Five activities are used in...

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A company uses activity-based costing to determine the costs of its three products: A, B, and C. The budgeted cost and activity for each of the company's three activity cost pools are shown in the following table: Budgeted Activity Activity Budgeted Cost Activity Cost Driver Product A Product B Product C $ 70,000 $ 45,000 $ 82,000 Square feet Units inspected Activity 1 6,000 9,000 20,000 Activity 2 Activity 3 7,000 15,000 8,000 Setups 2,500 1,000 1,625 What are the activity rates for the three activities under activity-based costing? Multiple Choice (1) $2.00 per square foot; (2) $3.00 per unit; (3) $3.50 per setup. (1) $3.50 per square foot; (2) $1.50 per unit; (3) $32,80 per setup. (1) $3.50 per square foot; (2) $3.00 per unit; (3) $16.00 per setup. (1) $2.00 per square foot: (2) $1.50 per unit; (3) $16.00 per setup.
Idris Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Budgeted Activity Cost Activity Activity Base Casting Machine hours Assembly Direct labor hours Inspecting Number of inspections Setup Number of setups Materials handling Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Casting Assembly Inspecting $210,680 146,160 18,810 47,950 46,000 Activity Base Entry Dining Machine hours 4,850 4,310 Direct labor hours 4,180 6,260 Number of inspections 1,300 410 Number of setups 280 Number of loads 790 Units produced 9,600 4,800 a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar. Activity Rate 70 210 Total 9,160 10,440 1,710 350 1,000 14,400…
Activity rates and product costs using activity-based cost Idris Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Activity BudgetedActivity Cost Activity Base Casting $320,620 Machine hours Assembly 182,750 Direct labor hours Inspecting 28,420 Number of inspections Setup 50,690 Number of setups Materials handling 36,540 Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Entry Dining Total Machine hours 5,000 4,430 9,430 Direct labor hours 4,300 6,450 10,750 Number of inspections 1,540 490 2,030 Number of setups 300 70 370 Number of loads 690 180 870 Units produced 10,000 5,000 15,000 This information has been collected in the Microsoft Excel…
Activity rates and product costs using activity-based cost Idris Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Activity Casting Assembly Inspecting Setup Materials handling Activity Base Machine hours Budgeted Activity Cost Direct labor hours Number of inspections Number of setups Number of loads Units produced $304,800 231,600 40,800 46,720 44,100 Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Total Entry Dining 5,380 4,780 4,630 6,950 1,820 580 260 Activity Base Machine hours Direct labor hours Number of inspections Number of setups Number of loads 710 10,800 60 190 5,400 10,160 11,580 2,400 320 900 16,200
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Activity rates and product costs using activity-based cost Idris Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Activity Casting Assembly Inspecting Budgeted Activity Cost $214,820 149,100 22,330 42,000 40,500 Activity Base Machine hours Direct labor hours Number of inspections Number of setups Number of loads Units produced Setup Materials handling Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Entry 4,950 4,260 1,540 Activity Base Machine hours Direct labpr hours Number of inspections Number of setups Number of loads 230 Dining Total 4,390 9,340 6,390 10,650 490 2,030 280 900 50 190 710 9,800 a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar. 4,900…
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