Atlanta Systems produces two different products, Product A, which sells for $450 per unit, and Product B, which sells for $800 per unit, using three different activities: Design, which uses Engineering Hours as an activity driver; Machining, which uses machine hours as an activity driver; and Inspection, which uses number of batches as an activity driver. The cost of each activity and usage of the activity drivers are as follows: Usage by Product A Usage by Cost Product B Design (Engineering Hours) Machining (Machine Hours) Inspection (Batches) $ 190,000 $1,800,000 $ 160,000 108 142 2,160 2,840 42 38 Atlanta manufactures 12,500 units of Product A and 10,200 units of Product B per month. Each unit of Product A uses $100 of direct materials and $45 of direct labor, while each unit of ProductB uses $140 of direct materials and $75 of direct lahor

Atlanta Systems produces two different products, Product A, which sells for $450 per unit, and Product B, which sells for $800 per unit, using three different activities: Design, which uses Engineering Hours as an activity driver; Machining, which uses machine hours as an activity driver; and Inspection, which uses number of batches as an activity driver. The cost of each activity and usage of the activity drivers are as follows: Usage by Product A Usage by Cost Product B Design (Engineering Hours) Machining (Machine Hours) Inspection (Batches) $ 190,000 $1,800,000 $ 160,000 108 142 2,160 2,840 42 38 Atlanta manufactures 12,500 units of Product A and 10,200 units of Product B per month. Each unit of Product A uses $100 of direct materials and $45 of direct labor, while each unit of ProductB uses $140 of direct materials and $75 of direct lahor

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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Bruce Corporation makes four products in a single facility. These products have the following unit product costs: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Unit product cost Additional data concerning these products are listed below. Grinding minutes per unit Selling price per unit Variable selling cost per unit Monthly demand in units Products A $14.80 C B $10.70 $11.50 27.90 3.20 19.90 4.80 27.00 35.30 $ 66.50 $ 77.10 $75.80 34.10 3.10 27.10 Products A B 4.30 5.80 $76.60 $94.00 $2.70 $ 1.70 4,500 4,500 D $ 11.10 40.90 3.70 37.70 $93.40 C D 4.80 3.90 $87.90 $ 104.70 $ 3.80 $ 2.10 3,500 2,500 The grinding machines are potentially the constraint in the production facility. A total of 71,400 minutes are available per month on these machines. Direct labor is a variable cost in this company. Up to how much should the company be willing to pay for one additional minute of grinding machine time if the company has made the best use of the…
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ABC Company uses activity-based costing to allocate MOH. The company has 2 products d and e. The annual production of sales of Product d are 1,000 units and product e is 3000 units. There are three activity cost pool of MOH with an estimated total cost of $69,000. What is the MOH cost per unit for product d under activity-based costing? Expected Activity (Allocation base) Total Activity Cost pool (for MOH) Activity 1 Activity 2 Activity 3 Estimated Cost of MOH Product d Product e $9000 500 500 1000 12000 200 200 500 48,000 500 1100 1600
Ivanhoe Company produces two products: Standard and Deluxe. The company uses an activity-based costing system. Ivanhoe produced 8400 units of Standard and 2400 units of Deluxe. The company uses two activity cost pools, with estimated total cost and activity as follows: Expected Activity Activity Cost Pool Estimated Cost Standard Deluxe #1 $12400 540 290 #2 $24400 440 1240 What is the cost per unit of Standard under activity-based costing? $14.52 $7.50 $1.72 $14.94
Assume that company makes only two products: Product A and Product B. The company’s activity-based costing system has allocated $144,000 to an activity called machine setups. It is considering allocating the machine setups cost to its products using either the number of setups or setup hours as the activity measure. It gathered the following data with respect to these two potential activity measures: Product A Product B Number of machine setups 30 45 Number of setup hours per setup 6 6 If the company uses number of setup hours as the activity measure, what is the activity rate for machine setups? rev: 10_30_2021_QC_CS-283805 Garrison 17e Rechecks 2021-11-13 Multiple Choice $11,825 $12,000 $320 $350
Alexander Inc. uses activity-based costing. The company produces two products: Snaps and Pops. The expected annual production of Snaps is 1800 units, while the expected annual production of Pops is 2500 units. There are three activity cost pools: Assembly, Testing, and Packing. The estimated costs and activities for each of these three activity pools follows: Expected activity Activity cost pool Estimated cost Snaps Pops Total Assembly $5648 620 160 780 Testing $26,115 1000 600 1600 Packing $2801 50 185 235 The overhead cost per unit of Pops would be closest to (Round all answers to two decimal places.) Question 24 options: $5.26 $8.56 $7.31 $11.89
[The following information applies to the questions displayed below.] Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow: Rims Posts Direct Labor- Hours per unit 0.60 0.60 Additional information about the company follows: a. Rims require $17 in direct materials per unit, and Posts require $14. b. The direct labor wage rate is $20 per hour. Activity Cost Pool Machine setups Special processing General factory c. Rims are more complex to manufacture than Posts and they require special equipment. d. The ABC system has the following activity cost pools: Annual Production Activity Cost Pool Machine setups Special processing General factory 26,000 units 84,000 units $ 14.00 Activity Measure Number of setups Machine-hours Direct labor-hours X Answer is not complete. Activity Rate Required: 1. Compute the activity rate for each activity cost pool. (Round your answers to 2 decimal places.) Estimated Overhead Cost $ 39,480 $…
A company makes two products—Product A and B. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Product A 0.75 20,000 units Product B 0.50 50,000 units Additional information is as follows: Product A requires $15 in direct materials per unit, and Product B requires $8. The direct labor wage rate is $18 per hour. The company’s activity-based absorption costing system has the following activity cost pools: Activity Cost Pool (and Activity Measures) Estimated Overhead Cost Expected Activity Product A Product B Total Machine setups (number of setups) $ 100,000 145 255 400 Special processing (machine-hours) $ 200,000 3,500 4,500 8,000 General factory (Direct labor-hours) $ 150,000 15,000 25,000 40,000 Using activity-based absorption costing, the unit product cost for Product B is closest to:
Escuha Company produces two type of calculators : scientific and business. Both products pass through two producing departments. The business calculator is by far the most popular. The following data have been gathered for these two products : Required: 1. Compute the overhead cost per unit for each product using a plantwide, unit-based rate using direct labor hours. 2. Compute the overhead cost per unit for each product using departmental rates.In calculating departmental rates, use machine hours for departmental 1 and direct labor hours for Department 2 . Repeat using direct labor hours for Department 1 and machine hours of Department 2 . 3. Compute the overhead cost per unit for each product using activity -based costing. 4. Comment on the ability of departmental rates to improve the accuracy of product costing.
Requ Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Number of machine hours Number of design hours Number of batches Suppose that Gable Company manufactures three products, A, B, and C. Information about these products follows: Product A Product B Product C 26,000 2,800 40 Total Cost of Pool Cost Driver $250,600 Number of machine hours 61,600 Number of design hours 66,402 Number of batches Product A Product B Product C Total Overhead Assigned 36,000 1,600 170 Estimated Cost Driver 71,600 7,000 465 9,600 2,600 255 Required: 1. Using activity proportions, determine the amount of overhead assigned to each product. (Do not round your intermediate calculations. Round your final answers to nearest whole number.)
Munoz Manufacturing produces two keyboards, one for laptop computers and the other for desktop computers. The production process is automated, and the company has found activity-based costing useful in assigning overhead costs to its products. The company has identified five major activities involved in producing the keyboards. Activity Materials receiving & handling Production setup Quality inspection Assembly Packing and shipping Allocation Base Cost of material Number of setups Number of parts Inspection time Number of orders Activity measures for the two kinds of keyboards follow: Allocation Rate 2% of material cost $112.00 per setup $7.00 per part $1.20 per minute $ 8.00 per order Laptops. Desktops Labor Cost $ 1,350 Material Cost Number of Setups 1,240 $ 6,500 7,100 31 Number of Parts 50 13 28 Inspection Time 6,800 minutes 4,600 minutes Number of Orders 62 22 Required a. Compute the cost per unit of laptop and desktop keyboards, assuming that Munoz made 200 units of each type of…
Godiva company has two products, A and B. The company uses activity-based costing to allocate overhead costs of $100,000. Data relating to the company's activity pools for the current year are given below: Cost Pool Total cost in Total Number of Activity Measures Used Cost Pool Product A Product B Total Activity 1 $42,000 100 200 300 Activity 2 $10,000 20 5 25 Activity 3 $48,000 3,000 3,000 6,000 Compute the activity rate (allocation rate) for Activity 2: $500 $2,000 $400 $140

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bartleby, a Learneo, Inc. business

(per unit)	Product A	Product B
Direct Materials	100.00	140.00
Direct Labor	45.00	75.00
Overhead Cost	75.49	118.27
Total Manufacturing cost per unit	220.49	333.27