Current Attempt in Progress Oriole Hollow Resort has ordered 21 rotomolded kayaks from Current Designs. Each kayak will be formed in the rotomolded oven, cooled, and then have the excess plastic trimmed away. Then, the hatches, seat, ropes, and bungees will be attached to the kayak. Dave Thill, the kayak factory manager, knows that manufacturing each kayak requires 50 pounds of polyethylene powder and a finishing kit (rope, seat, hardware, etc.). The polyethylene powder used in these kayaks costs $1.60 per pound, and the finishing kits cost $169 each. Each kayak will use two kinds of labor: 2 hours of more-skilled type I labor from people who run the oven and trim the plastic, and 3 hours of less-skilled type II labor from people who attach the hatches and seat and other hardware. The type I employees are paid $15 per hour, and the type II employees are paid $12 per hour. For purposes of this problem, assume that overhead is applied to all jobs at a rate of 150% of direct labor costs. Determine the total cost of the Oriole Hollow order and the cost of each individual kayak in the order. Identify costs as direct materials, direct labor, or manufacturing overhead. Direct Materials Polyethylene powder Finishing kit Direct labor More skilled Less skilled Manufacturing overhead Total cost for one kayak Total cost of the order $ +A tA
Current Attempt in Progress Oriole Hollow Resort has ordered 21 rotomolded kayaks from Current Designs. Each kayak will be formed in the rotomolded oven, cooled, and then have the excess plastic trimmed away. Then, the hatches, seat, ropes, and bungees will be attached to the kayak. Dave Thill, the kayak factory manager, knows that manufacturing each kayak requires 50 pounds of polyethylene powder and a finishing kit (rope, seat, hardware, etc.). The polyethylene powder used in these kayaks costs $1.60 per pound, and the finishing kits cost $169 each. Each kayak will use two kinds of labor: 2 hours of more-skilled type I labor from people who run the oven and trim the plastic, and 3 hours of less-skilled type II labor from people who attach the hatches and seat and other hardware. The type I employees are paid $15 per hour, and the type II employees are paid $12 per hour. For purposes of this problem, assume that overhead is applied to all jobs at a rate of 150% of direct labor costs. Determine the total cost of the Oriole Hollow order and the cost of each individual kayak in the order. Identify costs as direct materials, direct labor, or manufacturing overhead. Direct Materials Polyethylene powder Finishing kit Direct labor More skilled Less skilled Manufacturing overhead Total cost for one kayak Total cost of the order $ +A tA
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Current Attempt in Progress
Oriole Hollow Resort has ordered 21 rotomolded kayaks from Current Designs. Each kayak will be formed in the rotomolded oven,
cooled, and then have the excess plastic trimmed away. Then, the hatches, seat, ropes, and bungees will be attached to the kayak.
Dave Thill, the kayak factory manager, knows that manufacturing each kayak requires 50 pounds of polyethylene powder and a
finishing kit (rope, seat, hardware, etc.). The polyethylene powder used in these kayaks costs $1.60 per pound, and the finishing kits
cost $169 each. Each kayak will use two kinds of labor: 2 hours of more-skilled type I labor from people who run the oven and trim the
plastic, and 3 hours of less-skilled type II labor from people who attach the hatches and seat and other hardware. The type I employees
are paid $15 per hour, and the type II employees are paid $12 per hour. For purposes of this problem, assume that overhead is applied
to all jobs at a rate of 150% of direct labor costs.
Determine the total cost of the Oriole Hollow order and the cost of each individual kayak in the order. Identify costs as direct
materials, direct labor, or manufacturing overhead.
Direct Materials
Polyethylene powder
Finishing kit
Direct labor
More skilled
Less skilled
Manufacturing overhead
Total cost for one kayak
Total cost of the order
$
+A
tA
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