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Carlise has identified the following information about its overhead activity pools and the two product lines: Cost Assigned to Pool $ 17,472 $ 79,920 $ 36,960 Activity Pools Materials handling Quality control Machine maintenance 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. 4. Determine the amount of overhead Carlise 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? Cost Driver Number of moves Complete this question by entering your answers in the tabs below. Number of inspections Number of machine hours Required 1 Required 2 Required 3 Indoor Model Outdoor Model Total $ $ $ Required 4 Overhead Assigned 88,450 45,750 134,200 Suppose Carlise used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Required 5 < Required 1 Quantity or Amount Consumed by Indoor Line 620 moves 6,100 inspections 29,000 machine hours Quantity or Amount Consumed by Outdoor Line 290 moves 5,000 inspections 15,000 machine hours Required 2 >

Carlise has identified the following information about its overhead activity pools and the two product lines: Cost Assigned to Pool $ 17,472 $ 79,920 $ 36,960 Activity Pools Materials handling Quality control Machine maintenance 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. 4. Determine the amount of overhead Carlise 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? Cost Driver Number of moves Complete this question by entering your answers in the tabs below. Number of inspections Number of machine hours Required 1 Required 2 Required 3 Indoor Model Outdoor Model Total $ $ $ Required 4 Overhead Assigned 88,450 45,750 134,200 Suppose Carlise used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Required 5 < Required 1 Quantity or Amount Consumed by Indoor Line 620 moves 6,100 inspections 29,000 machine hours Quantity or Amount Consumed by Outdoor Line 290 moves 5,000 inspections 15,000 machine hours Required 2 >

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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Carlise has identified the following information about its overhead activity pools and the two product lines: Cost Assigned to Pool $ 17,472 $ 79,920 $ 36,960 Activity Pools Materials handling Quality control Machine maintenance 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. 4. Determine the amount of overhead Carlise 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? Cost Driver Number of moves Complete this question by entering your answers in the tabs below. Number of inspections Number of machine hours Required 1 Required 2 Required 3 Indoor Model Outdoor Model Total $ $ $ Required 4 Overhead Assigned 88,450 45,750 134,200 Suppose Carlise used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Required 5 < Required 1 Quantity or Amount Consumed by Indoor Line 620 moves 6,100 inspections 29,000 machine hours Quantity or Amount Consumed by Outdoor Line 290 moves 5,000 inspections 15,000 machine hours Required 2 >
Transcribed Image Text:Carlise has identified the following information about its overhead activity pools and the two product lines: Cost Assigned to Pool $ 17,472 $ 79,920 $ 36,960 Activity Pools Materials handling Quality control Machine maintenance 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. 4. Determine the amount of overhead Carlise 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? Cost Driver Number of moves Complete this question by entering your answers in the tabs below. Number of inspections Number of machine hours Required 1 Required 2 Required 3 Indoor Model Outdoor Model Total $ $ $ Required 4 Overhead Assigned 88,450 45,750 134,200 Suppose Carlise used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. Note: Do not round intermediate calculations and round your final answers to the nearest whole dollar amount. Required 5 < Required 1 Quantity or Amount Consumed by Indoor Line 620 moves 6,100 inspections 29,000 machine hours Quantity or Amount Consumed by Outdoor Line 290 moves 5,000 inspections 15,000 machine hours Required 2 >
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