a. Calculate the total manufacturing costs and the cost per unit produced and "Cost per unit" to 2 decimal places.) Total manufacturing cost Cost per unit produced and tested b. Which of the following are the advantages of the ABC approach relative to using a single predetermined overhead application rate based on direct labor hours. (Note: You do not have alternative method.) (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.) calculate the overhead that would be applied for the month of August using this ABC does not help in decision-making. 2 ABC systems produce more accurate financial information. 2 ABC approach is likely to provide better information to manufacturing managers. 2 ABC helps in decision-making. 2 ABC systems produce more accurate product costing information.
a. Calculate the total manufacturing costs and the cost per unit produced and "Cost per unit" to 2 decimal places.) Total manufacturing cost Cost per unit produced and tested b. Which of the following are the advantages of the ABC approach relative to using a single predetermined overhead application rate based on direct labor hours. (Note: You do not have alternative method.) (You may select more than one answer. Single click the box with the question mark to produce a check mark for a correct answer and double click the box with the question mark to empty the box for a wrong answer.) calculate the overhead that would be applied for the month of August using this ABC does not help in decision-making. 2 ABC systems produce more accurate financial information. 2 ABC approach is likely to provide better information to manufacturing managers. 2 ABC helps in decision-making. 2 ABC systems produce more accurate product costing information.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:MedTech Inc. manufactures and sells diagnostic equipment used in the medical profession. Its job costing system was designed using
an activity-based costing approach. Direct materials and direct labor costs are accumulated separately, along with information
concerning four manufacturing overhead cost drivers (activities). Assume that the direct labor rate is $23 per hour and that there were
no beginning inventories. The following information was available for 2019, based on an expected production level of 355,556 units
for the year:
Cost Driver Used as
Cost Allocation
Budgeted Costs
for 2019
Activity Cost
Rate
Allocation Base
Driver
ok
$2.00 per part
12.00 per hour
5.25 per hour
4.50 per unit
Number of parts used
Materials handling
Milling and grinding
Assembly and inspection
Testing
$4,800,000
8,000,000
5,800,000
1,600,000
Number of machine hours
nt
Direct labor hours worked
Number of units tested
ences
The following production, costs, and activities occurred during the month of August:
Direct
Number of Parts
Machine
Direct Labor
Units
Materials Costs
Used
Hours
Hours
Produced/Tested
53,000
$3,000,000
290,000
91,000
180,000
Required:
a. Calculate the total manufacturing costs and the cost per unit produced and tested during the month of August for MedTech. (Round
"Cost per unit" to 2 decimal places.)
Total manufacturing cost
Cost per unit produced and tested
Transcribed Image Text:Required:
a. Calculate the total manufacturing costs and the cost per unit produced and tested during the month of August for MedTech. (Round
"Cost per unit" to 2 decimal places.)
Total manufacturing cost
Cost per unit produced and tested
b. Which of the following are the advantages of the ABC approach relative to using a single predetermined overhead application rate
based on direct labor hours. (Note: You do not have to calculate the overhead that would be applied for the month of August using this
alternative method.) (You may select more than one answer. Single click the box with the question mark to produce a check mark
for a correct answer and double click the box with the question mark to empty the box for a wrong answer.)
ABC does not help in decision-making.
ABC systems produce more accurate financial information.
2 ABC approach is likely to provide better information to manufacturing managers.
2 ABC helps in decision-making.
2 ABC systems produce more accurate product costing information.
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