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Calculate activity-based overhead rate for each activity. (Round answers to 2 decimal places, e.g. 12.25.) Activity Purchasing Handling materials Production Inspecting Setting up machines $ Inventory control $ Utilities $ $ $ $ Overhead Rate per order per move per D/L hour per setup per inspection per component per sq. ft.

Calculate activity-based overhead rate for each activity. (Round answers to 2 decimal places, e.g. 12.25.) Activity Purchasing Handling materials Production Inspecting Setting up machines $ Inventory control $ Utilities $ $ $ $ Overhead Rate per order per move per D/L hour per setup per inspection per component per sq. ft.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Oriole Stairs Co. designs and builds factory-made premium wooden stairways for homes. The manufactured stairway components (spindles, risers, hangers, hand rails) permit installation of stairways of varying lengths and widths. All are of white oak wood. Budgeted manufacturing overhead costs for the year 2025 are as follows. Purchasing Handling materials Production (cutting, milling, finishing) Setting up machines Inspecting Inventory control (raw materials and finished goods) Utilities Total budgeted overhead costs Overhead Cost Pools Purchasing Handling materials Production (cutting, milling, finishing) Setting up machines Inspecting Inventory control (raw materials and finished goods) Utilities (a) Activity Cost Pools Direct materials Direct labor Machine hours Direct labor hours Number of purchase orders Number of material moves Number of machine setups Number of inspections Number of components Number of square feet occupied ✓ (b) For the last 4 years, Oriole Stairs Co. has been charging overhead to products on the basis of machine hours. For the year 2025, 100,000 machine hours are budgeted. Jeremy Nolan, owner-manager of Oriole Stairs Co., recently directed his accountant, Bill Seagren, to implement the activity-based costing system that he has repeatedly proposed. At Jeremy Nolan's request, Bill and the production foreman identify the following cost drivers and their usage for the previously budgeted overhead cost pools. Your answer is correct. Predetermined overhead rate ✓ eTextbook and Media Your answer is correct. Cost per stairway $104,100 $113,000 $ eTextbook and Media 16,000 $ 5,500 Steve Hannon, sales manager, has received an order for 250 stairways from Community Builders, Inc., a large housing development contractor. At Steve's request, Bill prepares cost estimates for producing components for 250 stairways so Steve can submit a contract price per stairway to Community Builders. He accumulates the following data for the production of 250 stairways. 60 800 100 450 16,000 Amount 8,000 $75,000 82.000 220,000 1499.44 105,000 108,000 126,000 270,000 $986,000 Cost Drivers Compute the predetermined overhead rate using traditional costing with machine hours as the basis. (Round answer to 2 decimal places, e.g. 12.25.) Number of orders Number of moves Direct labor hours Number of setups. Number finspections Number of components Square feet occupied Estimated Use of Cost Drivers 9.86 600 8,000 per machine hour 100,000 1,250 6,000 168,000 What is the manufacturing cost per stairway under traditional costing? (Round answer to 2 decimal places, e.g. 12.25.) 90,000 Attempts: 1 of 5 used Attempts: 1 of 5 used
Transcribed Image Text:Oriole Stairs Co. designs and builds factory-made premium wooden stairways for homes. The manufactured stairway components (spindles, risers, hangers, hand rails) permit installation of stairways of varying lengths and widths. All are of white oak wood. Budgeted manufacturing overhead costs for the year 2025 are as follows. Purchasing Handling materials Production (cutting, milling, finishing) Setting up machines Inspecting Inventory control (raw materials and finished goods) Utilities Total budgeted overhead costs Overhead Cost Pools Purchasing Handling materials Production (cutting, milling, finishing) Setting up machines Inspecting Inventory control (raw materials and finished goods) Utilities (a) Activity Cost Pools Direct materials Direct labor Machine hours Direct labor hours Number of purchase orders Number of material moves Number of machine setups Number of inspections Number of components Number of square feet occupied ✓ (b) For the last 4 years, Oriole Stairs Co. has been charging overhead to products on the basis of machine hours. For the year 2025, 100,000 machine hours are budgeted. Jeremy Nolan, owner-manager of Oriole Stairs Co., recently directed his accountant, Bill Seagren, to implement the activity-based costing system that he has repeatedly proposed. At Jeremy Nolan's request, Bill and the production foreman identify the following cost drivers and their usage for the previously budgeted overhead cost pools. Your answer is correct. Predetermined overhead rate ✓ eTextbook and Media Your answer is correct. Cost per stairway $104,100 $113,000 $ eTextbook and Media 16,000 $ 5,500 Steve Hannon, sales manager, has received an order for 250 stairways from Community Builders, Inc., a large housing development contractor. At Steve's request, Bill prepares cost estimates for producing components for 250 stairways so Steve can submit a contract price per stairway to Community Builders. He accumulates the following data for the production of 250 stairways. 60 800 100 450 16,000 Amount 8,000 $75,000 82.000 220,000 1499.44 105,000 108,000 126,000 270,000 $986,000 Cost Drivers Compute the predetermined overhead rate using traditional costing with machine hours as the basis. (Round answer to 2 decimal places, e.g. 12.25.) Number of orders Number of moves Direct labor hours Number of setups. Number finspections Number of components Square feet occupied Estimated Use of Cost Drivers 9.86 600 8,000 per machine hour 100,000 1,250 6,000 168,000 What is the manufacturing cost per stairway under traditional costing? (Round answer to 2 decimal places, e.g. 12.25.) 90,000 Attempts: 1 of 5 used Attempts: 1 of 5 used
Calculate activity-based overhead rate for each activity. (Round answers to 2 decimal places, e.g. 12.25.) Activity Purchasing Handling materials Production Inspecting Inventory control $ Setting up machines $ Utilities $ $ $ $ $ Overhead Rate per order per move per D/L hour per setup per inspection per component per sq. ft.
Transcribed Image Text:Calculate activity-based overhead rate for each activity. (Round answers to 2 decimal places, e.g. 12.25.) Activity Purchasing Handling materials Production Inspecting Inventory control $ Setting up machines $ Utilities $ $ $ $ $ Overhead Rate per order per move per D/L hour per setup per inspection per component per sq. ft.
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