Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and anactivity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct laborcosts.ProductsProduct 540XProduct 137YProduct 2495(a)Sales RevenueProduct 137Y$208,000Product 540X $Product 2495$155,000$92,000Total CostsTraditional$54,00048,000For each product line, compute operating income using the traditional costing system.23,000ABC$49,00030,00046,000F

Traditional costing income is a standard technique for external financial reporting that is required…

Ayala Inc. has conducted the following analysis related to its product lines, using a traditional co activity-based costing system. Both the traditional and the activity-based costing systems inclu costs. Products Product 540X Product 137Y Sales Revenue $208,000 155,000 Total Costs Traditional ABC $54,000 $49,000 48,000 30,000 00.000 46.000

Ayala Inc. has conducted the following analysis related to its product lines, using a traditional co activity-based costing system. Both the traditional and the activity-based costing systems inclu costs. Products Product 540X Product 137Y Sales Revenue $208,000 155,000 Total Costs Traditional ABC $54,000 $49,000 48,000 30,000 00.000 46.000

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter12: Activity-based Management

Section: Chapter Questions

Problem 1CE: Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and...

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Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs. Total Costs Products Sales Revenue Traditional АВС Product 540X $ 202,000 $ 59,000 $ 45,900 Product 137Y 172,000 52,000 41,000 Product 2495 84,000 17,000 41,100 X Your answer is incorrect. For each product line, compute operating income using the traditional costing system. Product 540X S 143760 Product 137Y 109610 Product 2495 71900 eTextbook and Media Solution X Your answer is incorrect. For each product line, compute operating income using the activity-based costing system. Product 540X 24 152680 Product 137Y 119410 Product 2495 24 59180 %24 %24
Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs.Products Sales Revenue Traditional ABC Product 540x $180,000 $55,000 $50,000 Product 137Y 160,000 50,000 35,000 Product 249S 70,000 15,000 35,000(a) For each product line, compute operating income using the traditional costing system. (b) For each product line, compute operating income using the activity-based costingsystem. (c) Using the following formula, compute the percentage difference in operating incomefor each of the product lines of Ayala: [Operating Income (ABC) − Operating Income(traditional cost)] ÷ Operating Income (traditional cost). (Round to two decimals.) (d) Provide a rationale as to why the…
Question: Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs. Total Costs Sales Revenue Traditional ABC Products Product 540X $180,000 $55,000 $50,000 Product 137Y 160,000 50,000 35,000 Product 249S 70,000 15,000 35,000 For each product line, compute operating income using the traditional costing system: Product 540X $ Product 137Y $ Product 249S $
Ivanhoe Inc. has conducted the following analysis related to its product lines using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and activity-based costing systems include direct materials and direct labour costs. Products Product 440X Product 137Y Product 249S (a) Sales Revenue $201,000 172,000 Operating income 87,000 Total Costs Traditional $55,000 74,000 26,000 Additional information related to product usage by these pools is as follows: ABC $50,036 70,668 34,296 For each product line, calculate operating income using the traditional costing system. Product 440X Traditional costing system $ Product 137Y $ Product 249S
Ayala Inc. has conducted the following analysis related to its product lines, using a traditional costing system (volume-based) and an activity-based costing system. Both the traditional and the activity-based costing systems include direct materials and direct labor costs. Products Product 540X Product 137Y Product 2495 Sales Revenue $208,000 155,000 92.000 Total Costs Traditional $54,000 48,000 23.000 ABC $49,000 30,000 46,000