Determine how much the job would cost given the following activities: Do not round intermediate computations and round final answers to nearest whole number.

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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A local picnic table manufacturer has budgeted these overhead costs:

Purchasing $70,000
Handling Materials 34,580
Machine Setups 72,000
Inspections 30,600
Utilities 27,000

They are considering adapting ABC costing and have estimated the cost drivers for each pool as shown:

Cost Driver Activity
Orders 700
Material Moves 1,330
Machine Setups 16,000
Number of Inspections 6,000
Square Feet 180,000

Recent success has yielded an order for 1,000 tables. Assume direct labor costs per hour of $20.

  Activity
Order, Units 1,000
Direct Materials 112,600
Machine Hours 15,300
Direct Labor Hours 5,200
Number of Purchase Orders 70
Number of Material Moves 750
Number of Machine Setups 100
Number of Inspections 450
Number of Square Feet Occupied 8,000

Determine how much the job would cost given the following activities: Do not round intermediate computations and round final answers to nearest whole number.

  Cost Assigned
Direct Materials   $fill in the blank 1  
Direct Labor   fill in the blank 2  
Number of Material Moves   fill in the blank 3  
Number of Machine Setups   fill in the blank 4  
Number of Inspections   fill in the blank 5  
Number of Square Feet Occupied   fill in the blank 6  
Total Order Cost

 

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