Benson Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity cost pools follow: Cost Cost driver Unit Level $ 55,100 1,900 labor hours. Activities. Batch Level $ 21,420 42 setups Product Level $ 10,000 Percentage of use Facility Level $ 154,000 14,000 units Production of 760 sets of cutting shears, one of the company's 20 products, took 280 labor hours and 8 setups and consumed 18 percent of the product-sustaining activities. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 760 units are produced. If direct product costs are $120 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Complete this question by entering your answers in the tabs below.

Benson Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity cost pools follow: Cost Cost driver Unit Level $ 55,100 1,900 labor hours. Activities. Batch Level $ 21,420 42 setups Product Level $ 10,000 Percentage of use Facility Level $ 154,000 14,000 units Production of 760 sets of cutting shears, one of the company's 20 products, took 280 labor hours and 8 setups and consumed 18 percent of the product-sustaining activities. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 760 units are produced. If direct product costs are $120 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Complete this question by entering your answers in the tabs below.

Name: price would the product sein under tali diivation system:Complete thi
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Description: price would the product sein under tali diivation system:Complete this question by entering your answers in the tabs below.Req A and BReq CCompute the overhead cost per unit for cutting shears first using activity-based costing and then using direct

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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Campbell Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity cost pools follow: Cost Cost driver Unit Level $75,400 Req A and B 2,900 labor hours Production of 870 sets of cutting shears, one of the company's 20 products, took 160 labor hours and 7 setups and consumed 19 percent of the product-sustaining activities. Complete this question by entering your answers in the tabs below. Req C Allocated overhead Direct cost Total cost per unit Desired profit Sales price Required 8. Had the company used labor hours as a companywide allocation base, how much overhead would It have allocated to the cutting shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using…
Required information Greenwood Company manufactures two products-14,000 units of Product Y and 6,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Machining Machine setups Production design General factory Activity Measure Machining Number of setups Number of products Direct labor-hours Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Plantwide overhead rate Estimated Overhead Cost $ 192,000 $ 50,400 $ 76,000 $ 387,200 Product Y Product Z 7,200 50 2,800 70 1 1 7,200 8,800 per DLH Expected Activity 10,000 MHS 120 setups 2 products Required: 1. What is the company's plantwide overhead rate? (Round your answer to 2 decimal places.) 16,000 DLHS
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