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cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Actual Activity Usage Setups Parts Inspections Required 1 Required 2 Complete this question by entering your answers in the tabs below. Per Unit Using a plantwide overhead rate based on 4,500 direct labor hours, compute the total product cost per unit for each product. Product Cost per Unit Product A Product B Required 1 Required 2 Direct Materials Machine setup Parts handling Quality inspection a. Compute overhead activity rates Activity Product A 8 setups 10,000 parts 40 inspections Direct Labor Activity Machine setup Parts handling Quality inspection Total allocated cost Units produced Product A Product B Consider the following additional information about these two products. If activity-based costing is used to allocate overhead cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Note: Round your final answers to 2 decimal places. Overhead < Required 1 per setup per part per inspection b. Allocate overhead to Product A, B and compute overhead cost per unit Allocated Cost Product B 12 setups 6,000 parts 60 inspections Overhead cost per unit c. Product cost per unit using activity-based costing Per Unit Product A Activity Rate Required 2 > Product Cost per Unit < Required 1 Product B Required 2 Show less

cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Actual Activity Usage Setups Parts Inspections Required 1 Required 2 Complete this question by entering your answers in the tabs below. Per Unit Using a plantwide overhead rate based on 4,500 direct labor hours, compute the total product cost per unit for each product. Product Cost per Unit Product A Product B Required 1 Required 2 Direct Materials Machine setup Parts handling Quality inspection a. Compute overhead activity rates Activity Product A 8 setups 10,000 parts 40 inspections Direct Labor Activity Machine setup Parts handling Quality inspection Total allocated cost Units produced Product A Product B Consider the following additional information about these two products. If activity-based costing is used to allocate overhead cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Note: Round your final answers to 2 decimal places. Overhead < Required 1 per setup per part per inspection b. Allocate overhead to Product A, B and compute overhead cost per unit Allocated Cost Product B 12 setups 6,000 parts 60 inspections Overhead cost per unit c. Product cost per unit using activity-based costing Per Unit Product A Activity Rate Required 2 > Product Cost per Unit < Required 1 Product B Required 2 Show less

Managerial Accounting
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 3PB: Activity-based department rate product costing and product cost distortions Big Sound Inc....
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Consider the following data for two products of Vigano Manufacturing. Budgeted Cost Activity Machine setup Parts handling Quality inspections Total budgeted overhead Unit Information Units produced Direct materials cost Direct labor cost Direct labor hours. Actual Activity Usage Setups Parts Inspections 1. Using a plantwide overhead rate based on 4,500 direct labor hours, compute the total product cost per unit for each product. 2. Consider the following additional information about these two products. If activity-based costing is used to allocate overhead cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Required 1 Required 2 Per Unit Product A Product B Complete this question by entering your answers in the tabs below. Required 1 Required 2 Direct Materials Activity Driver $ 18,000 (20 machine setups) 14,400 (16,000 parts) 21,600 (100 inspections) $ 54,000 Product A 1,800 units $28 per unit $ 48 per unit 2 per unit Using a plantwide overhead rate based on 4,500 direct labor hours, compute the total product cost per unit for each product. Product Cost per Unit Machine setup Parts handling Quality inspection a. Compute overhead activity rates Activity Product A 8 setups 10,000 parts Product A Product B Activity Direct Labor 40 inspections Product B 360 units $ 38 per unit $ 58 per unit 2.50 per unit Overhead Required 1 Consider the following additional information about these two products. If activity-based costing is used to allocate overhead cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Note: Round your final answers to 2 decimal places. Machine setup Parts handling Quality inspection Total allocated cost Units produced Overhead cost per unit c. Product cost per unit using activity-based costing Per Unit per setup per part per inspection b. Allocate overhead to Product A, B and compute overhead cost per unit Allocated Cost Product B 12 setups 6,000 parts 60 inspections Product A < Activity Rate Product Cost per Unit Required 2 > Required 1 Product B Required 2 Show less A
Transcribed Image Text:Consider the following data for two products of Vigano Manufacturing. Budgeted Cost Activity Machine setup Parts handling Quality inspections Total budgeted overhead Unit Information Units produced Direct materials cost Direct labor cost Direct labor hours. Actual Activity Usage Setups Parts Inspections 1. Using a plantwide overhead rate based on 4,500 direct labor hours, compute the total product cost per unit for each product. 2. Consider the following additional information about these two products. If activity-based costing is used to allocate overhead cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Required 1 Required 2 Per Unit Product A Product B Complete this question by entering your answers in the tabs below. Required 1 Required 2 Direct Materials Activity Driver $ 18,000 (20 machine setups) 14,400 (16,000 parts) 21,600 (100 inspections) $ 54,000 Product A 1,800 units $28 per unit $ 48 per unit 2 per unit Using a plantwide overhead rate based on 4,500 direct labor hours, compute the total product cost per unit for each product. Product Cost per Unit Machine setup Parts handling Quality inspection a. Compute overhead activity rates Activity Product A 8 setups 10,000 parts Product A Product B Activity Direct Labor 40 inspections Product B 360 units $ 38 per unit $ 58 per unit 2.50 per unit Overhead Required 1 Consider the following additional information about these two products. If activity-based costing is used to allocate overhead cost, (a) compute overhead activity rates, (b) allocate overhead cost to Product A and Product B and compute overhead cost per unit for each, and (c) compute product cost per unit for each. Note: Round your final answers to 2 decimal places. Machine setup Parts handling Quality inspection Total allocated cost Units produced Overhead cost per unit c. Product cost per unit using activity-based costing Per Unit per setup per part per inspection b. Allocate overhead to Product A, B and compute overhead cost per unit Allocated Cost Product B 12 setups 6,000 parts 60 inspections Product A < Activity Rate Product Cost per Unit Required 2 > Required 1 Product B Required 2 Show less A
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