a-1. Compute the predetermined overhead rate under the current method. (Round your answer to 2 decimal places.) Predetermined overhead rate per DLH a-2. Determine the unit product cost of each product for the current year. (Round your intermediate calculations and final answers to 2 decimal places.)

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Chapter1: Financial Statements And Business Decisions
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b. The company is considering using an activity-based costing system to compute unit product costs for external financial reports
instead of its traditional system based on direct labor-hours. The activity-based costing system would use three activity cost pools.
Data relating to these activities for the current period are given below:
Activity Cost Pools
Machine setups
Purchase orders
Order size
Total
Unit product cost
Estimated Overhead
Costs
$ 12,990
77,640
95,280
$185,910
Product C
Product C
190
980
8,400
Product D
Expected Activity
Product D
200
1,320
7,140
Determine the unit product cost of each product for the current period using the activity-based costing approach. (Round your
intermediate calculations and final answers to 2 decimal places.)
Total
390
2,300
15,540
Transcribed Image Text:b. The company is considering using an activity-based costing system to compute unit product costs for external financial reports instead of its traditional system based on direct labor-hours. The activity-based costing system would use three activity cost pools. Data relating to these activities for the current period are given below: Activity Cost Pools Machine setups Purchase orders Order size Total Unit product cost Estimated Overhead Costs $ 12,990 77,640 95,280 $185,910 Product C Product C 190 980 8,400 Product D Expected Activity Product D 200 1,320 7,140 Determine the unit product cost of each product for the current period using the activity-based costing approach. (Round your intermediate calculations and final answers to 2 decimal places.) Total 390 2,300 15,540
Cabio Company manufactures two products, Product C and Product D. The company estimated it would incur $185,910 in
manufacturing overhead costs during the current period. Overhead currently is applied to the products on the basis of direct labor-
hours. Data concerning the current period's operations appear below:
Estimated volume
Direct labor-hours per unit
Direct materials cost per unit
Direct labor cost per unit.
Unit product cost
per DLH
Product C
Product C
4,200 units
2.00 hours
Required:
a-1. Compute the predetermined overhead rate under the current method. (Round your answer to 2 decimal places.)
Predetermined overhead rate
$15.60
$ 20.00
Product D
Product D
3,400 units
2.10 hours
a-2. Determine the unit product cost of each product for the current year. (Round your intermediate calculations and final answers to
2 decimal places.)
$ 28.50
$ 21.00
Transcribed Image Text:Cabio Company manufactures two products, Product C and Product D. The company estimated it would incur $185,910 in manufacturing overhead costs during the current period. Overhead currently is applied to the products on the basis of direct labor- hours. Data concerning the current period's operations appear below: Estimated volume Direct labor-hours per unit Direct materials cost per unit Direct labor cost per unit. Unit product cost per DLH Product C Product C 4,200 units 2.00 hours Required: a-1. Compute the predetermined overhead rate under the current method. (Round your answer to 2 decimal places.) Predetermined overhead rate $15.60 $ 20.00 Product D Product D 3,400 units 2.10 hours a-2. Determine the unit product cost of each product for the current year. (Round your intermediate calculations and final answers to 2 decimal places.) $ 28.50 $ 21.00
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