**Overhead Cost Allocation Analysis for Carlisle's Product Lines**Carlisle has identified the following information about its overhead activity pools and the two product lines:**Activity Pools and Cost Drivers:**| Activity Pools | Cost Driver | Cost Assigned to Pool | Quantity or Amount Consumed by Indoor Line | Quantity or Amount Consumed by Outdoor Line ||-------------------------|---------------------------|-----------------------|---------------------------------------------|-----------------------------------------------|| Materials handling | Number of moves | $20,910 | 570 moves | 450 moves || Quality control | Number of inspections | $85,120 | 6,100 inspections | 5,100 inspections || Machine maintenance | Number of machine hours | $34,790 | 28,000 machine hours | 21,000 machine hours |**Required:**1. Suppose Carlisle used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line.2. Calculate the activity proportions for each activity pool in Carlisle’s ABC system. 3. Calculate the amount of overhead that Carlisle will assign to the Indoor line if it uses an ABC system.4. Determine the amount of overhead Carlisle will assign to the Outdoor line if it uses an ABC system.5. Compare the results for a traditional system with an ABC system. Which do you think is more accurate?**Instructions:**- Complete this question by entering your answers in the tabs below.- Use machine hours as the cost driver for the traditional costing system and calculate overhead.- Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount.**Table for Overhead Assignment:**- **Indoor Model**- **Outdoor Model**- **Total**This analysis will help in understanding how different costing systems affect overhead distribution among product lines, thereby informing more accurate pricing and cost strategies.

Name: **Overhead Cost Allocation Analysis for Carlisle's Product Lines**Car
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Description: **Overhead Cost Allocation Analysis for Carlisle's Product Lines**Carlisle has identified the following information about its overhead activity pools and the two product lines:**Activity Pools and Cost Drivers:**| Activity Pools | Cost Driv

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Carlise has identified the following information about its overhead activity pools and the two product lines: Activity Pools Materials handling Quality control Machine maintenance Cost Driver Number of moves Number of inspections Number of machine hours Cost Assigned to Pool $ 20,910 $ 85,120 $ 34,790 Quantity or Amount Consumed by Quantity or Amount Consumed by Indoor Line Outdoor Line 570 moves 6,100 inspections 28,000 machine hours. 450 moves 5,100 inspections 21,000 machine hours Required: 1. Suppose Carlise used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. 2. Calculate the activity proportions for each activity pool in Carlise's ABC system. 3. Calculate the amount of overhead that Carlise will assign to the Indoor line if it uses an ABC system.

Carlise has identified the following information about its overhead activity pools and the two product lines: Activity Pools Materials handling Quality control Machine maintenance Cost Driver Number of moves Number of inspections Number of machine hours Cost Assigned to Pool $ 20,910 $ 85,120 $ 34,790 Quantity or Amount Consumed by Quantity or Amount Consumed by Indoor Line Outdoor Line 570 moves 6,100 inspections 28,000 machine hours. 450 moves 5,100 inspections 21,000 machine hours Required: 1. Suppose Carlise used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. 2. Calculate the activity proportions for each activity pool in Carlise's ABC system. 3. Calculate the amount of overhead that Carlise will assign to the Indoor line if it uses an ABC system.

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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[The following information applies to the questions displayed below.] Benton Corporation manufactures computer microphones, which come in two models: Standard and Premium. Data for a representative quarter for the two models follow: Units produced Production runs per quarter Direct materials cost per unit Direct labor cost per unit Supervision Setup labor Incoming inspection Total overhead Manufacturing overhead in the plant has three main functions: supervision, setup labor, and incoming material inspection. Data on manufacturing overhead for a representative quarter follow: Standard 10,400 50 $ 30 50 $ 214,500 249,600 179,400 $ 643,500 a. Overhead rate b. Supervision b. Setup labor b. Incoming inspection Premium 2,600 25 $ 64 75 Required: a. Benton currently applies overhead on the basis of direct labor cost. What is the predetermined overhead rate for the quarter? b. The CFO and the plant controller at Benton are thinking of adopting an ABC system. They have tentatively chosen the…
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