Activity BaseEntryDiningTotalMachine hours5,3204,71010,030Direct labor hours4,5706,86011,430Number of inspections1,9406102,550Number of setups31070380Number of loads700190890Units produced10,6005,30015,900a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar.ActivityActivity RateCastingper machine hourAssemblyper direct labor hourInspecting24per inspectionSetupper setupMaterials handlingper loadb. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product. Round the per unit amounts to thenearest cent.ProductTotal Activity CostActivity Cost Per UnitEntry Lighting FixturesDining Room Lighting Fixtures Activity Rates and Product Costs using Activity-Based CostingLonsdale Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and theirassociated budgeted activity costs and activity bases are as follows:BudgetedActivityActivity Cost Activity BaseCasting$320,960Machine hoursAssembly182,880Direct labor hoursInspecting33,150Number of inspectionsSetup52,060Number of setupsMaterials handling46,280Number of loadsCorporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities andunits produced follow:Activity BaseEntryDiningTotalMachine hours5,3204,71010,030Direct labor hours4,5706,86011,430Number of inspections1,9406102,550Number of setups31070380Number of loads700190890Units produced10,6005,30015,900

Overheads are considered as fixed and common expenses that should be allocated to the products based…

Activity Base Entry Dining Total Machine hours 5,320 4,710 10,030 Direct labor hours 4,570 6,860 11,430 Number of inspections 1,940 610 2,550 Number of setups 310 70 380 Number of loads 700 190 890 Units produced 10,600 5,300 15,900 a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar. Activity Activity Rate Casting %24 per machine hour Assembly per direct labor hour Inspecting %$4 per inspection Setup per setup Materials handling per load b. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product. Round the per unit amounts to the nearest cent. Product Total Activity Cost Activity Cost Per Unit Entry Lighting Fixtures Dining Room Lighting Fixtures

Activity Base Entry Dining Total Machine hours 5,320 4,710 10,030 Direct labor hours 4,570 6,860 11,430 Number of inspections 1,940 610 2,550 Number of setups 310 70 380 Number of loads 700 190 890 Units produced 10,600 5,300 15,900 a. Determine the activity rate for each activity. If required, round the rate to the nearest dollar. Activity Activity Rate Casting %24 per machine hour Assembly per direct labor hour Inspecting %$4 per inspection Setup per setup Materials handling per load b. Use the activity rates in (a) to determine the total and per-unit activity costs associated with each product. Round the per unit amounts to the nearest cent. Product Total Activity Cost Activity Cost Per Unit Entry Lighting Fixtures Dining Room Lighting Fixtures

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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