Colonels uses a traditional cost system and estimates next year's overhead will be $651,000, with the estimated cost driver of 217,000 direct labor hours. It manufacturesthree products and estimates the following costs:Small Medium Large31,000 10,000 3,000$8 $8611UnitsDirect Material CostDirect Labor Hours per UnitIf the labor rate is $30 per hour, what is the per-unit cost of each product?SmallMediumCost per unit$44Large

Predetermined Overhead Rate :— It is the rate used to allocate manufacturing overhead cost to cost…

Answered: Colonels uses a traditional cost 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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artinez Company’s relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 6.50 Direct labor $ 4.00 Variable manufacturing overhead $ 1.60 Fixed manufacturing overhead $ 4.00 Fixed selling expense $ 3.50 Fixed administrative expense $ 2.20 Sales commissions $ 1.20 Variable administrative expense $ 0.45 Required: 1. For financial accounting purposes, what is the total amount of product costs incurred to make 10,000 units? (Do not round intermediate calculations.)
Factor Company estimates that producing a unit of product would require $8 per unit of direct materials and $24 per unit of direct labor. Factor Company normally applies overhead using a predetermined overhead rate of 150% of direct labor cost. Factor Company estimates incremental overhead of $16 per unit of product. An outside supplier offers to provide Factor Company with all the units it needs at a price of $46 per unit. Factor Company should choose to: Multiple Choice O O O Buy since the relevant cost to make it is $56. Make since the relevant cost to make it is $48. Buy since the relevant cost to make it is $48. Make since the relevant cost to make it is $32. Buy since the relevant cost to make it is $32.
Unit cost per rims? And Unit cost per posts?
Cane Company manufactures two products called Alpha and Beta that sell for $175 and $135, respectively. Each product uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 117,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 13. Assume that Cane's customers would buy a maximum of 91,000 units of Alpha and 71,000 units of Beta. Also assume that the raw material available for production is limited to 225,000 pounds. How many units of each product should Cane produce to maximize its profits? Units produced Alpha Beta $…
The Jaguar Company, which manufactures electrical switches, uses a standard costing system and carries all inventories at standard. The standard manufacturing overhead costs per switch are based on direct labor hours and are shown below: Variable MOH (5 hours @ $12 per DMfgL hour) Fixed MOH (5 hours @ $15* per DMfgL hour) Total MOH per switch *Based on a capacity of 200,000 DMfgL hours per month The following information is available for the month of October: > 46,000 switches were produced, although 40,000 switches were scheduled to be produced. > 225,000 DMfgL hours were worked at a total cost of $5,625,000. Actual variable MOH costs were $2,750,000. Actual fixed MOH costs were $3,050,000. $ 60 75 $135 1. Compute the variable MOH spending, efficiency, and flexible-budget variances, and the allocated variable MOH costs.
Martinez Company's relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Direct materials Direct labor Variable manufacturing overhead Fixed manufacturing overhead Fixed selling expense Fixed administrative expense Sales commissions Variable administrative expense Average Cost Per Unit $ 6.20 $ 3.70 $ 1.60 $ 4.00 $ 3.20 $2.20 $ 1.20 $ 0.45 11. If 8,000 units are produced, what is the total manufacturing overhead cost incurred to support this level of production? What is this total amount expressed on a per-unit basis? Note: Round your "per unit" answer to 2 decimal places. Total manufacturing overhead cost Manufacturing overhead per unit
Addy Company has two products: A and B. The annual production and sales of Product A is 1,700 units and of Product B is 1,100 units. The company has traditionally used direct labor-hours as the basis for applying all manufacturing overhead to products. Product A requires 0.3 direct labor-hours per unit and product B requires 0.6 direct labor-hours per unit. The total estimated overhead for next period is $98,785. The company is considering switching to an activity-based costing system for the purpose of computing unit product costs for external reports. The new activity-based costing system would have three overhead activity cost pools- Activity 1, Activity 2, and General Factory- with estimated overhead costs and expected activity as follows: Activity Cost pool Estimated Overhead Costs Expected Product A Expected Product B Total Activity 1 $30,528 1,000 600 1,600 Activity 2 $17,385 1,700 200 1,900 General Factory $50,872 510 660 1,170 Total $98,785 Note: The…
Cane Company manufactures two products called Alpha and Beta that sell for $125 and $85, respectively. Each product uses only one type of raw material that costs $6 per pound. The company has the capacity to annually produce 101,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $ 30 21 8 Traceable fixed manufacturing overhead 17 13 16 $ 105 Alpha Beta The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. $12 20 Required: 1. What is the total amount of traceable fixed manufacturing overhead for each of the two products? Beta 19 9 11 $ 77
Martinez Company’s relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Average Cost per Unit Direct materials $ 5.50 Direct labor $ 3.00 Variable manufacturing overhead $ 1.50 Fixed manufacturing overhead $ 4.00 Fixed selling expense $ 2.50 Fixed administrative expense $ 2.00 Sales commissions $ 1.00 Variable administrative expense $ 0.50 11. If 8,000 units are produced, what is the total amount of manufacturing overhead cost incurred to support this level of production? What is this total amount expressed on a per unit basis? (Round your "per unit" answer to 2 decimal places.) __________________________________________________________________________________________ Martinez Company’s relevant range of production is 7,500 units to 12,500 units. When it produces and sells 10,000 units, its average costs per unit are as follows: Average Cost per…
Cane Company manufactures two products called Alpha and Beta that sell for $175 and $135, respectively. Each product uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 117,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha $ 40 Beta $ 15 30 30 18 16 26 29 23 19 26 21 $ 163 $ 130 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. oundational 11-13 (Algo) . Assume that Cane's customers would buy a maximum of 91,000 units of Alpha and 71,000 units of Beta. Also assume that the raw aterial available for production is limited to 225,000 pounds. How many units of…
Crystal Pools estimates overhead will utilize 250,000 machine hours and cost $750,000. It takes 2 machine hours per unit, direct material cost of $14 per unit, and direct labor of $20 per unit. What is the cost of each unit produced?
Cane Company manufactures two products called Alpha and Beta that sell for $175 and $135, respectively. Each product uses only one type of raw material that costs $5 per pound. The company has the capacity to annually produce 117,000 units of each product. Its average cost per unit for each product at this level of activity are given below: Direct materials Direct labor Variable manufacturing overhead Traceable fixed manufacturing overhead Variable selling expenses Common fixed expenses Total cost per unit Alpha Beta $ 40 $15 30 18 26 23 26 $ 163 The company considers its traceable fixed manufacturing overhead to be avoidable, whereas its common fixed expenses are unavoidable and have been allocated to products based on sales dollars. 2. What is the company's total amount of common fixed expenses? Total common fixed expenses 30 16 29 19 21 $ 130

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