Advanced Products Corporation supplied the following data from its activity-based costing system: Overhead Costs Wages and salaries Other overhead costs. Total overhead costs Activity Cost Pool Supporting direct labor Order processing Customer support Other Wages and salaries Other overhead costs Selling price Direct materials Direct labor $ 300,000 100,000 $ 400,000 Activity Measure Number of direct labor-hours Number of customer orders Number of customers This is an organization- sustaining activity Distribution of Resource Consumption Across Activities Supporting Order Direct Labor Processing 30% 10% Data Concerning the Shenzhen Enterprises Order Units ordered 10 units Direct labor-hours Wages and salaries Other overhead costs Total cost $ 40% 30% During the year, Advanced Products completed one order for a new customer, Shenzhen Enterprises. This customer did not order any other products during the year. Data concerning that order follow: 2 DLHS per unit $300 per unit $180 per unit $50 per unit Required 1 Required 2 Required 3 Complete this question by entering your answers in the tabs below. Required: 1. Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. 3. Calculate the total overhead costs for the order from Shenzhen Enterprises including customer support costs. 4. Calculate the customer margin for Shenzhen Enterprises. 0 Required 4 Total Activity for the Year 20,000 DLHs Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools. Direct Labor Support Order Processing $ 400 orders 200 customers Not applicable Customer Support 20% 20% Customer Support 0 $ Required 1 0 $ Other 10% 40% Other Required 2 > Total 100% 100% $ $ 0 $ Totals 0 0 0
Advanced Products Corporation supplied the following data from its activity-based costing system: Overhead Costs Wages and salaries Other overhead costs. Total overhead costs Activity Cost Pool Supporting direct labor Order processing Customer support Other Wages and salaries Other overhead costs Selling price Direct materials Direct labor $ 300,000 100,000 $ 400,000 Activity Measure Number of direct labor-hours Number of customer orders Number of customers This is an organization- sustaining activity Distribution of Resource Consumption Across Activities Supporting Order Direct Labor Processing 30% 10% Data Concerning the Shenzhen Enterprises Order Units ordered 10 units Direct labor-hours Wages and salaries Other overhead costs Total cost $ 40% 30% During the year, Advanced Products completed one order for a new customer, Shenzhen Enterprises. This customer did not order any other products during the year. Data concerning that order follow: 2 DLHS per unit $300 per unit $180 per unit $50 per unit Required 1 Required 2 Required 3 Complete this question by entering your answers in the tabs below. Required: 1. Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools. 2. Compute the activity rates for the activity cost pools. 3. Calculate the total overhead costs for the order from Shenzhen Enterprises including customer support costs. 4. Calculate the customer margin for Shenzhen Enterprises. 0 Required 4 Total Activity for the Year 20,000 DLHs Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools. Direct Labor Support Order Processing $ 400 orders 200 customers Not applicable Customer Support 20% 20% Customer Support 0 $ Required 1 0 $ Other 10% 40% Other Required 2 > Total 100% 100% $ $ 0 $ Totals 0 0 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Advanced Products Corporation supplied the following data from its activity-based costing system:
Overhead Costs
Wages and salaries
Other overhead costs
Total overhead costs
Activity Cost Pool
Supporting direct labor
Order processing
Customer support
Other
Wages and salaries
Other overhead costs
$ 300,000
100,000
$ 400,000
Activity Measure
Number of direct labor-hours
Number of customer orders
Number of customers
This is an organization-
sustaining activity
Distribution of Resource Consumption Across Activities
Supporting
Order
Direct Labor Processing
30%
10%
Wages and salaries
Other overhead costs
Total cost
Data Concerning the Shenzhen Enterprises Order
Units ordered
10 units
Direct labor-hours
Selling price
Direct materials
Direct labor
40%
30%
$
2 DLHS per unit
$ 300 per unit
$ 180 per unit
$ 50 per unit
Required 1 Required 2 Required 3
During the year, Advanced Products completed one order for a new customer, Shenzhen Enterprises. This customer did not order any
other products during the year. Data concerning that order follow:
Complete this question by entering your answers in the tabs below.
Required:
1. Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools.
2. Compute the activity rates for the activity cost pools.
3. Calculate the total overhead costs for the order from Shenzhen Enterprises including customer support costs.
4. Calculate the customer margin for Shenzhen Enterprises.
Required 4
Total Activity for the
Year
Order
Processing
0 $
20,000 DLHS
Prepare a report showing the first-stage allocations of overhead costs to the activity cost pools.
Direct Labor
Support
Customer
Support
0 $
4 Required 1
400 orders
200 customers
Not applicable
Customer
Support
20%
20%
0 $
Other
10%
40%
Other
Required 2 >
0
Total
100%
100%
$
$
$
Totals
0
0
0
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Step 1: Explain the concept of Activity Based Costing:
VIEWStep 2: (1) Prepare a report showing the first-stage allocations of overhead costs to activity cost pools:
VIEWStep 3: (2) Compute the activity rates for the activity cost pools:
VIEWStep 4: (3) Calculate the total overhead costs for the order from Shenzhen Enterprises:
VIEWStep 5: (4) Calculate the customer margin for Shenzhen Enterprises:
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