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9:39 ...... 20.0 KB/S ១ | 83 + 304 Problem 8-3: Compute overhead using ABC System. Chapter 8 Gigabytes Computers, Inc. manufactures two styles of computer keyboards, the Multimedia Keyboard and the Comfort Type Keyboard. The company uses activity based costing to allocate overhead costs to its products. The following activity centers have been identified: Activity Center Material Handling Cost Driver Cost of materials No. of setups No. of keyboards No. of keyboards No. of orders Machine Setup Assembly Inspection Packaging and Shipping Multimedia Keyboards No. of keyboards 400 No. of setups 45 No. of orders 9 Material costs P12,000 Required: Allocation Rate 5% of material cost P320 per setup P 24 per keyboard P 10 per keyboard P 20 per order Comfort Type Keyboards 700 25 16 P15,400. 1. Compute the total overhead costs assigned to each type of keyboard. 2. Compute the overhead cost per keyboard for each type of keyboard. Problem 84: Allocation of overhead using ABC System. PPG Company manufactures two products: Product SS and Product HH. During January 50 of Product SS and 300 of Product HH were produced, and overhead costs of P81,000 were incurred. An analysis of overhead costs reveals the following activities: Activity 1. Materials handling 2. Machine setups 3. Quality inspections Cost Driver Number of requisitions Number of setups Number of inspections The cost drive volume for each product was as follows: Number of requisitions Cost Driver Number of of setups Number of inspections Instructions: Product SS 400 150 200 Total Cost P30,000 27,000 24,000 Product HH 600 300 400 (a) Determine the overhead rate for each activity. (b) Allocate the manufacturing overhead costs to the two products using ABC. U О

9:39 ...... 20.0 KB/S ១ | 83 + 304 Problem 8-3: Compute overhead using ABC System. Chapter 8 Gigabytes Computers, Inc. manufactures two styles of computer keyboards, the Multimedia Keyboard and the Comfort Type Keyboard. The company uses activity based costing to allocate overhead costs to its products. The following activity centers have been identified: Activity Center Material Handling Cost Driver Cost of materials No. of setups No. of keyboards No. of keyboards No. of orders Machine Setup Assembly Inspection Packaging and Shipping Multimedia Keyboards No. of keyboards 400 No. of setups 45 No. of orders 9 Material costs P12,000 Required: Allocation Rate 5% of material cost P320 per setup P 24 per keyboard P 10 per keyboard P 20 per order Comfort Type Keyboards 700 25 16 P15,400. 1. Compute the total overhead costs assigned to each type of keyboard. 2. Compute the overhead cost per keyboard for each type of keyboard. Problem 84: Allocation of overhead using ABC System. PPG Company manufactures two products: Product SS and Product HH. During January 50 of Product SS and 300 of Product HH were produced, and overhead costs of P81,000 were incurred. An analysis of overhead costs reveals the following activities: Activity 1. Materials handling 2. Machine setups 3. Quality inspections Cost Driver Number of requisitions Number of setups Number of inspections The cost drive volume for each product was as follows: Number of requisitions Cost Driver Number of of setups Number of inspections Instructions: Product SS 400 150 200 Total Cost P30,000 27,000 24,000 Product HH 600 300 400 (a) Determine the overhead rate for each activity. (b) Allocate the manufacturing overhead costs to the two products using ABC. U О

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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9:39 ...... 20.0 KB/S ១ | 83 + 304 Problem 8-3: Compute overhead using ABC System. Chapter 8 Gigabytes Computers, Inc. manufactures two styles of computer keyboards, the Multimedia Keyboard and the Comfort Type Keyboard. The company uses activity based costing to allocate overhead costs to its products. The following activity centers have been identified: Activity Center Material Handling Cost Driver Cost of materials No. of setups No. of keyboards No. of keyboards No. of orders Machine Setup Assembly Inspection Packaging and Shipping Multimedia Keyboards No. of keyboards 400 No. of setups 45 No. of orders 9 Material costs P12,000 Required: Allocation Rate 5% of material cost P320 per setup P 24 per keyboard P 10 per keyboard P 20 per order Comfort Type Keyboards 700 25 16 P15,400. 1. Compute the total overhead costs assigned to each type of keyboard. 2. Compute the overhead cost per keyboard for each type of keyboard. Problem 84: Allocation of overhead using ABC System. PPG Company manufactures two products: Product SS and Product HH. During January 50 of Product SS and 300 of Product HH were produced, and overhead costs of P81,000 were incurred. An analysis of overhead costs reveals the following activities: Activity 1. Materials handling 2. Machine setups 3. Quality inspections Cost Driver Number of requisitions Number of setups Number of inspections The cost drive volume for each product was as follows: Number of requisitions Cost Driver Number of of setups Number of inspections Instructions: Product SS 400 150 200 Total Cost P30,000 27,000 24,000 Product HH 600 300 400 (a) Determine the overhead rate for each activity. (b) Allocate the manufacturing overhead costs to the two products using ABC. U О
Transcribed Image Text:9:39 ...... 20.0 KB/S ១ | 83 + 304 Problem 8-3: Compute overhead using ABC System. Chapter 8 Gigabytes Computers, Inc. manufactures two styles of computer keyboards, the Multimedia Keyboard and the Comfort Type Keyboard. The company uses activity based costing to allocate overhead costs to its products. The following activity centers have been identified: Activity Center Material Handling Cost Driver Cost of materials No. of setups No. of keyboards No. of keyboards No. of orders Machine Setup Assembly Inspection Packaging and Shipping Multimedia Keyboards No. of keyboards 400 No. of setups 45 No. of orders 9 Material costs P12,000 Required: Allocation Rate 5% of material cost P320 per setup P 24 per keyboard P 10 per keyboard P 20 per order Comfort Type Keyboards 700 25 16 P15,400. 1. Compute the total overhead costs assigned to each type of keyboard. 2. Compute the overhead cost per keyboard for each type of keyboard. Problem 84: Allocation of overhead using ABC System. PPG Company manufactures two products: Product SS and Product HH. During January 50 of Product SS and 300 of Product HH were produced, and overhead costs of P81,000 were incurred. An analysis of overhead costs reveals the following activities: Activity 1. Materials handling 2. Machine setups 3. Quality inspections Cost Driver Number of requisitions Number of setups Number of inspections The cost drive volume for each product was as follows: Number of requisitions Cost Driver Number of of setups Number of inspections Instructions: Product SS 400 150 200 Total Cost P30,000 27,000 24,000 Product HH 600 300 400 (a) Determine the overhead rate for each activity. (b) Allocate the manufacturing overhead costs to the two products using ABC. U О
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