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ctivity based costing

ctivity based costing

FINANCIAL ACCOUNTING
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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Investigations into the production overhead activities for the period reveal the following: Product A D Number of set-ups 4 24 8 32 Number of material orders 4 32 32 Number of times material Was handled 8 40 12 48 Number of spare parts used 8 20 16 Required: a) Unit cost per product using the machine hour rate (6 marks) Unit cost per product using the activity based costing (12 marks) 4.
Transcribed Image Text:Investigations into the production overhead activities for the period reveal the following: Product A D Number of set-ups 4 24 8 32 Number of material orders 4 32 32 Number of times material Was handled 8 40 12 48 Number of spare parts used 8 20 16 Required: a) Unit cost per product using the machine hour rate (6 marks) Unit cost per product using the activity based costing (12 marks) 4.
Question Two a) Amazon Itd produces three products; A, B, C and D using the same processing plant. The following information relates to the company: Product A B D Units produced 2,000 20,000 2,400 28,000 Material cost per unit (sh) 20 20 64 68 Labour hours per unit 2. 8. Machine hours per unit 1 Labour cost per unit (sh) 12 12 48 36 The cost accountant analyzed the production overheads recorded under the following headings: Overhead cost element Amount (sh) Setup costs 17,420,000 Factory costs (machine oriented activity) 149,696,000 Cost of ordering materials 7,680,000 Materials handling costs 30,320,000 Administration cost for spare parts 34,400,000 Investigations into the production overhead activities for the period reveal the following:
Transcribed Image Text:Question Two a) Amazon Itd produces three products; A, B, C and D using the same processing plant. The following information relates to the company: Product A B D Units produced 2,000 20,000 2,400 28,000 Material cost per unit (sh) 20 20 64 68 Labour hours per unit 2. 8. Machine hours per unit 1 Labour cost per unit (sh) 12 12 48 36 The cost accountant analyzed the production overheads recorded under the following headings: Overhead cost element Amount (sh) Setup costs 17,420,000 Factory costs (machine oriented activity) 149,696,000 Cost of ordering materials 7,680,000 Materials handling costs 30,320,000 Administration cost for spare parts 34,400,000 Investigations into the production overhead activities for the period reveal the following:
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