Coral Marine Company has total estimated factory overhead for the year of $1,017,200, divided into four activities: fabrication, $414,700; assembly, $177,500; setup, $143,000; and inspection, $282,000. Coral manufactures two types of boats: a speedboat and a bass boat. The activity-base usage quantities for each product by each activity are as follows: Fabrication Assembly Setup Inspection Speedboat 1,100 dlh 1,500 dlh 50 setups 120 inspections Bass boat 1,800 1,000 80 350 2,900 dlh 2,500 dlh 130 setups 470 inspections Each product is budgeted for 100 units of production for the year. a. Determine the activity rates for each activity. Fabrication $fill in the blank per dlh Assembly $fill in the blank per dlh Setup $fill in the blank per setup Inspection $fill in the blank per inspection b. Determine the factory overhead cost per unit for each product, using activity-based costing. If required, round to the nearest cent. Speedboat $fill in the blank Bass boat $fill in the blank
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Activity-Based Costing
Coral Marine Company has total estimated factory
| Fabrication | Assembly | Setup | Inspection | |||||
| Speedboat | 1,100 | dlh | 1,500 | dlh | 50 | setups | 120 | inspections |
| Bass boat | 1,800 | 1,000 | 80 | 350 | ||||
| 2,900 | dlh | 2,500 | dlh | 130 | setups | 470 | inspections |
Each product is budgeted for 100 units of production for the year.
a. Determine the activity rates for each activity.
| Fabrication | $fill in the blank | per dlh |
| Assembly | $fill in the blank | per dlh |
| Setup | $fill in the blank | per setup |
| Inspection | $fill in the blank | per inspection |
b. Determine the
| Speedboat | $fill in the blank |
| Bass boat | $fill in the blank |
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