Copr. Goed! Alphabet Inc. currently makes part ABC internally. Cost data to make the product are providedbelow.Direct materials$8.20Direct labor$2.40Variable manufacturing$3.30overheadFixed manufacturingoverhead$3.90The employee making the product would be terminated if theproduct is purchased from an outside supplier. Variablemanufacturing overhead would be eliminated. Of the fixedmanufacturing overhead, $0.90 is traceable to the production ofthe product and would be eliminated. The remaining fixedoverhead would not be eliminated.What is the relevant cost per unit to make ABC part internally?$17.0$16.90$13.90$14.80SUBMIT

The objective of the question is to calculate the relevant cost per unit to make the ABC part…

Answered: Copr. Goed! Alphabet Inc. currently…

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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Current Attempt in Progress Jobs, Inc. has recently started the manufacture of Tri-Robo, a three-wheeled robot that can scan a home for fires and gas leaks and then transmit this information to a smartphone. The cost structure to manufacture 20,000 Tri-Robos is as follows. Direct materials ($50 per robot) Direct labor ($40 per robot) Variable overhead ($6 per robot) Allocated fixed overhead ($30 per robot) Total Cost (a1) $1,000,000 800,000 120,000 600,000 $2,520,000 Jobs is approached by Tienh Inc., which offers to make Tri-Robo for $115 per unit or $2,300,000. Following are independent assumptions. A W P & X f C
Baja Industries has recently switched its method of applying manufacturing overhead from a single predetermined overhead rate based on direct labor hours to activity-based costing (ABC). Assume that the direct labor rate is $18.00 per hour and that there were no beginning inventories. The following cost drivers and rates have been developed for allocating manufacturing overhead costs: Activity Cost Driver Rate Material handling Number of parts used $ 2.00 per part Assembly and inspection Number of direct labor hours $25.00 per DLH Testing Number of units tested $ 5.00 per unitThe following production, costs, and activities occurred during the month of August: Direct…
XYZ Ltd. is a manufacturing company that follows the cost allocation approach for overhead allocation. The company uses three cost pools for allocating overhead costs: Material Handling, Machine Maintenance, and Factory Utilities. Each cost pool has its own cost driver. For the current accounting period, the company incurred the following costs and activity levels: Material Handling Costs: $150,000 Cost Driver: Number of Material Orders - 2,500 orders Machine Maintenance Costs: $250,000 Cost Driver: Machine Hours - 10,000 hours Factory Utilities Costs: $200,000 Cost Driver: Direct Labor Hours - 5,000 hours Calculate the overhead allocation rate for each cost pool based on the given information. A) Material Handling: $60 per order, Machine Maintenance: $25 per hour, Factory Utilities: $40 per direct labor hour. B) Material Handling: $30 per order, Machine Maintenance: $25 per hour, Factory Utilities: $40 per direct labor hour. C) Material Handling: $60 per order, Machine…
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[The following information applies to the questions displayed below.] Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow: Rims Posts Direct Labor- Hours per unit 0.60 0.60 Additional information about the company follows: a. Rims require $17 in direct materials per unit, and Posts require $14. b. The direct labor wage rate is $20 per hour. Activity Cost Pool Machine setups Special processing General factory c. Rims are more complex to manufacture than Posts and they require special equipment. d. The ABC system has the following activity cost pools: Annual Production Activity Cost Pool Machine setups Special processing General factory 26,000 units 84,000 units $ 14.00 Activity Measure Number of setups Machine-hours Direct labor-hours X Answer is not complete. Activity Rate Required: 1. Compute the activity rate for each activity cost pool. (Round your answers to 2 decimal places.) Estimated Overhead Cost $ 39,480 $…
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Blossom, Inc., is a small company that manufactures three versions of patio tables. Unit information for its products follows:
Upstate Mechanical, Inc., has been producing two bearings, components T79 and B81, for use in production. Data regarding these two components follow. Machine hours required per unit Standard cost per unit: Direct material Direct labor Manufacturing overhead Variable* Fixed Total T79 B81 2.5 3.0 $ 2.25 $ 3.75 4.00 4.50 2.00 2.25 3.75 4.50 $12.00 $15.00 *Variable manufacturing overhead is applied on the basis of direct-labor hours. *Fixed manufacturing overhead is applied on the basis of machine hours. Upstate Mechanical's annual requirement for these components is 8,000 units of T79 and 11,000 units of B81. Recently, management decided to devote additional machine time to other product lines, leaving only 41,000 machine hours per year for producing the bearings. An outside company has offered to sell Upstate Mechanical its annual supply of bearings at prices of $11.25 for T79 and $13.50 for B81. Management wants to schedule the otherwise idle 41,000 machine hours to produce bearings so…
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Hakara Company has been using direct labor costs as the basis for assigning overhead to its many products. Under this allocation system, product A has been assigned overhead of $26.87 per unit, while product B has been assigned $7.62 per unit. Management feels that an ABC system will provide a more accurate allocation of the overhead costs and has collected the following cost pool and cost driver information: Cost Pools Activity Costs $ 415,000 120,000 44,000 The following cost information pertains to the production of A and B, just two of Hakara's many products: Machine setup Materials handling Electric power Number of units produced Direct materials cost Direct labor cost Number of setup hours Pounds of materials used Kilowatt-hours Product A Product B A 5,000 $ 22,000 $ 39,000 Cost per Unit Cost Drivers Setup hours Pounds of materials Kilowatt-hours 200 2,000 4,000 B 20,000 $ 26,000 $ 37,000 Activity Driver Consumption 5,000 15,000 22,000 200 2,000 4,000 Required: 1. Use…
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Solve only c and d

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