Calculators P/L manufactures two types of products, Advanced and Simple, and applies manufacturing overhead toall units at the rate of $100 per machine hour. Production information follows.SimpleSetups (SU)Machine hours (MH)Outgoing shipment (OS)The total cost for each activity were:$20$151MSetups (SU)Machine hours (MH)Direct material costDirect labour costBudgeted volume (units)YOU determined that the firm's overhead can be identified with three activities:SimpleAdvanced200160,000100$30$15800,000Advanced300140,00080Total500300,000180$1.25M$35MOutgoing shipment (OS) $2M▪ Calculate the unit manufacturing cost of Simple and Advanced using Activity-Based Costing.

Name: Calculators P/L manufactures two types of products, Advanced and Simp
Uploaded: 2024-03-20T06:33:06.000Z
Channel: Bartleby
Description: Calculators P/L manufactures two types of products, Advanced and Simple, and applies manufacturing overhead toall units at the rate of $100 per machine hour. Production information follows.SimpleSetups (SU)Machine hours (MH)Outgoing shipment (OS)The

The activity-based costing approach is a way of allocating overhead and indirect expenses to goods…

Business

Accounting

Calculators P/L manufactures two types of products, Advanced and Simple, and applies manufacturing overhead to all units at the rate of $100 per machine hour. Production information follows. Simple Advanced $20 $15 1M Setups (SU) Machine hours (MH) Outgoing shipment (OS) The total cost for each activity were: Direct material cost Direct labour cost Budgeted volume (units) YOU determined that the firm's overhead can be identified with three activities: Simple $30 $15 800,000 200 160,000 100 Advanced 300 140,000 80 Total 500 300,000 180 Setups (SU) $1.25M Machine hours (MH) $35M Outgoing shipment (OS) $2M Calculate the unit manufacturing cost of Simple and Advanced using Activity-Based Costing.

Calculators P/L manufactures two types of products, Advanced and Simple, and applies manufacturing overhead to all units at the rate of $100 per machine hour. Production information follows. Simple Advanced $20 $15 1M Setups (SU) Machine hours (MH) Outgoing shipment (OS) The total cost for each activity were: Direct material cost Direct labour cost Budgeted volume (units) YOU determined that the firm's overhead can be identified with three activities: Simple $30 $15 800,000 200 160,000 100 Advanced 300 140,000 80 Total 500 300,000 180 Setups (SU) $1.25M Machine hours (MH) $35M Outgoing shipment (OS) $2M Calculate the unit manufacturing cost of Simple and Advanced using Activity-Based Costing.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Assume a company manufactures only two products—14,000 units of Product C and 6,000 units of Product D. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to three cost pools. The following additional information is available for the company as a whole and for Products C and D: Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity Machining Machine-hours $ 300,000 15,000 MH Machine setups Number of setups $ 150,000 200 Setups Product design Number of products $ 78,000 2 Products Activity Measure Product C Product D Machine-hours 9,000 6,000 Number of setups 50 150 Number of products 1 1 Using the ABC system, how much total overhead cost would be assigned from all of the activities to Product D? Multiple Choice $271,500 $261,500 $301,500 $251,500
< Multiple Versus Single Overhead Rates, Activity Drivers Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Expected Cost Activity Driver Activity Capacity Number of setups Number of orders Activity Setting up equipment Ordering costs Machine costs Receiving Receiving hours Deoro produces two models of dishwashers with the following expected prime costs and activity demands: Direct materials Direct labor Units completed Direct labor hours Number of setups Number of orders Machine hours Receiving hours $464,550 Required: 336,300 747,000 424,200 Model A Machine hours $604,000 498,000 17,000 5,800 410 Model B $804,000 456,000 8,700 1,500 6,200 23,500 3,800 The company's normal activity is 7,300 direct labor hours. 160 11,500 18,000 6,300 570 17,700 41,500 10,100 1. Determine the unit cost for each model using direct labor hours to apply overhead. Round intermediate calculations and final answers to nearest cent.
A company allocates $7.50 of overhead per direct labor hour to products. The company uses a plantwide overhead rate with direct labor hours as the allocation base. Given the amounts below, how many direct labor hours does the company expect in department 2? Budgeted: Department 1 Department 2 Manufacturing overhead costs $ 74,358 $ 49,572 Direct labor hours 6,610 DLH ? DLH Machine hours 700 MH 800 MH
Drilling Company uses activity-based costing and provides this information: Manufacturing Activity Cost Driver Driver Rate Materials handling Number of parts $ 0.60 Machinery Number of machine hours 51.00 Assembly Number of parts 2.85 Inspection Number of finished units 30.00 Drilling has just completed 80 units of a component for a customer. Each unit required 100 parts and 3 machine hours. The prime cost is $1,300 per finished unit. All other manufacturing costs are classified as manufacturing overhead. Required: 1. Compute the total manufacturing costs and the unit costs of the 80 units just completed using ABC costing. 2. In addition to the manufacturing costs, the firm has determined that the total cost of upstream activities, including research and development and product design, is $180 per unit. The total cost of downstream activities, such as distribution, marketing, and customer service, is $300 per unit. Compute the full product cost per unit, including…
A manufacturer uses activity-based costing to assign overhead cost to products. Budgeted cost information for its activities follows. Budgeted Cost $ 210,600 Activity Cost Driver Purchase orders Square feet Budgeted Activity Usage 5,400 purchase orders 5,900 square feet 50 Setups Factory services 104,250 Setup 67,750 Setups Compute an activity rate for each activity. (Round your answers to 2 decimal places.) Activity Purchasing Activity Purchasing Factory services Setup Budgeted Cost 210,600 104,250 67,750 $ $ $ Budgeted Activity Usage Activity Rate
Boswell Company manufactures two products, Regular and Supreme. Boswell's overhead costs consist of machining. $2400000; and assembling. $1200000. Information on the two products is: Direct labor hours Machine hours Number of parts Regular Supreme 10000 15000 30000 90000 160000 Ⓒ$2568000 $1440000. $2160000. $1032000. 10000 Overhead applied to Regular using activity-based costing is
Heintz Products uses activity-based costing to account for product costs. The plant manager has estimated the following cost drivers and rates. Activity Centers Materials inspection Equipment maintenance Machine setups Packing and shipping Cost Drivers Direct materials cost Machine-hours Number of production runs Pounds of finished output Rate per Cost Driver Unit 15% of materials cost $ 19 per machine-hour $ 6,370 per setup $ 4.20 per pound Direct materials costs were $508,000 and direct labor costs were $348,000 during November, when the plant finished 7,000 pounds of product, had 20 setups, and ran the machines for 15,000 hours. There were no work-in-process inventories. Required: Use T-accounts to show the flow of materials, labor, and overhead costs from the four overhead activity centers through Work- in-Process Inventory and out to Finished Goods Inventory. Use the accounts Materials Inventory, Wages Payable, Work-in- Process Inventory, Finished Goods Inventory, and four…
Multiple Versus Single Overhead Rates, Activity Drivers Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Expected Cost Activity Driver Activity Capacity Number of setups Number of orders Machine hours Activity Setting up equipment $491,050 Ordering costs 336,600 Machine costs 898,800 Receiving 362,600 Receiving hours Deoro produces two models of dishwashers with the following expected prime costs and activity demands: Model A Model B $843,000 $455,000 8,200 1,600 Direct materials Direct labor Units completed Direct labor hours Number of setups Number of orders Machine hours $563,000 $459,000 15,600 6,800 360 6,900 23,900 3,200 The company's normal activity is 8,400 direct labor hours. Receiving hours 250 12,900 18,900 6,600 610 19,800 42,800 9,800
Maxey & Sons manufactures two types of storage cabinets—Type A and Type B—and applies manufacturing overhead to all units at the rate of $120 per machine hour. Production information follows. Type A Type BAnticipated volume (units) 24,000 45,000 Direct-material cost per unit $ 28 $ 42 Direct-labor cost per unit 33 33 The controller, who is studying the use of activity-based costing, has determined that the firm’s overhead can be identified with three activities: manufacturing setups, machine processing, and product shipping. Data on the number of setups, machine hours, and outgoing shipments, which are the activities’ three respective cost drivers, follow. Type A Type B TotalSetups 140 100 240 Machine hours 48,000 67,500 115,500 Outgoing shipments 200 150 350 The firm’s total…
Doles Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products. Activity Cost Pools Setting up batches Processing customer orders Assembling products Data concerning two products appear below: Number of batches Number of customer orders Number of assembly hours Total overhead cost Activity Rate $69.22 per batch $26.28 per customer order $ 12.11 per assembly hour Product K52W 65 45 418 Required: How much overhead cost would be assigned to each of the two products using the company's activity-based costing system? (Round your intermediate calculations and final answers to 2 decimal places.) Product K52W Product X94T Product X94T 52 30 161
Maxey & Sons manufactures two types of storage cabinets-Type A and Type B-and applies manufacturing overhead to all units at the rate of $120 per machine hour. Production information follows. Descriptions Anticipated volume (units) Direct-material cost per unit Direct-labor cost per unit Descriptions The controller, who is studying the use of activity-based costing, has determined that the firm's overhead can be identified with three activities: manufacturing setups, machine processing, and product shipping. Data on the number of setups, machine hours, and outgoing shipments, which are the activities' three respective cost drivers, follow. Setups Machine hours Outgoing shipments Type A 140 48,000 200 Required 1 Required 2 Required 3 Type A 24,000 $ 28 33 The firm's total overhead of $13,860,000 is subdivided as follows: manufacturing setups, $3,024,000; machine processing, $8,316,000; and product shipping, $2,520,000. Required: 1. Compute the unit manufacturing cost of Type A and Type…
Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity Capacity Setting up equipment Number of setups Ordering costs Number of orders Machine costs Receiving Direct materials Direct labor Deoro produces two models of dishwashers with the following expected prime costs and activity demands: Model A Units completed Direct labor hours Number of setups Number of orders $627,000 481,000 16,200 6,400 370 5,800 24,900 3,700 The company's normal activity is 7,900 direct labor hours. Machine hours Receiving hours Required: Model A Model B $482,510 372,000 864,000 410,000 Receiving hours Model A Machine hours $ del B Model B Unit Cost $836,000 497,000 8,500 1,500 240 1. Determine the unit cost for each model using direct labor hours to apply overhead. Round intermediate calculations and final answers to nearest cent. 12,800 18,300 6,300 610 18,600 43,200 10,000 2. Determine the unit cost for…