Durban Metal Products, Limited, of the Republic of South Africa makes speclalty metal parts used In applications ranging fromthe cutting edges of bulldozer blades to replacement parts for Land Rovers. The company uses an activity-based costingsystem for Internal decislon-making purposes. The company has four actlvity cost pools as listed below:Activity Rate$ 17.70 per direct labor-hour$ 358.08 per customer order$ 78.08 per testing hour$ 1,492.00 per sales callActivity Cost PoolOrder sizeActivity MeasureNumber of direct labor-hoursCustomer ordersNumber of custoner ordersProduct testingSellingNumber of testing hoursNumber of sales callsThe managing director of the company would like Information concerning the cost of a recently completed order for heavy-duty traller axles. The order requlred 100 direct labor-hours, 17 hours of product testing, and 5 sales calls.Required:What Is the total overhead cost assigned to the order for heavy-duty traller axles?Activity Cost PoolАВС CostOrder sizeCustomer ordersProduct testingSellingTotal overhead cost Hiram's Lakeside is a popular restaurant located on Lake Washington In Seattle. The owner of the restaurant has been tryingto better understand costs at the restaurant and has hired a student Intern to conduct an activity-based costing study. TheIntern, In consultation with the owner, Identified three major activities and then completed the first-stage allocations of costs tothe activity cost pools. The results appear below.Activity Cost PoolServing a party of dinersServing a dinerServing drinkSActivity MeasureNunber of parties servedNunber of diners servedTotal Activity5,680 parties12,188 dinersTotal Cost$ 15,120$ 107,690$ 31,610Nunber of drinks ordered10,989 drinksThe above costs Include all of the costs of the restaurant except for organization-sustalining costs such as rent, property taxes,and top-management salarles.Some costs, such as the cost of cleaning the linens that cover the restaurant's tables, vary with the number of parties served.Other costs, such as washing plates and glasses, depend on the number of diners served or the number of drinks served.Prior to the activity-based costing study, the owner knew very little about the costs of the restaurant. She knew that the totalcost for the month (Including organization-sustalning costs) was $180,000 and that 12,000 diners had been served. Therefore,the average cost per diner was $15.Required:182. According to the activity-based costing system, what Iis the total cost and average cost per diner for serving each of thefollowing partles of diners? (Round your Intermediate calculations to 2 decimal places. Round your Total Cost final answersto 2 decimal places and your Average Cost final answers to 3 decimal places.)Total CostAverage Costa. A party of six diners who order four drinks in total.per dinerb. A party of four diners who do not order any drinks.per dinerc. A party of one diner who orders two drinks.per diner

Name: Durban Metal Products, Limited, of the Republic of South Africa makes
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Description: Durban Metal Products, Limited, of the Republic of South Africa makes speclalty metal parts used In applications ranging fromthe cutting edges of bulldozer blades to replacement parts for Land Rovers. The company uses an activity-based costingsystem

ABC cost = Activity rate * activity cost pool

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Durban Metal Products, Limited, of the Republic of South Africa makes specialty metal parts used in applications ranging from the cutting edges of bulldozer blades to replacement parts for Land Rovers. The company uses an activity-based costing system for Internal decision-making purposes. The company has four activity cost pools as listed below: Activity Cost Pool Order size Activity Measure Number of direct labor-hours Activity Rate $ 17.70 per direct labor-hour $ 358.80 per custoner order $ 78.08 per testing hour $ 1,492.00 per sales call Customer orders Number of custoner orders Product testing Selling Number of testing hours Number of sales calls The managing director of the company would like Information concerning the cost of a recently completed order for heavy- duty traller axles. The order required 100 direct labor-hours. 17 hours of product testing, and 5 sales calls. Required: What is the total overhead cost assigned to the order for heavy-duty trailer axles? Activity Cost Pool ABC Cost Order size Customer orders Product testing Selling Total overhead cost

Durban Metal Products, Limited, of the Republic of South Africa makes specialty metal parts used in applications ranging from the cutting edges of bulldozer blades to replacement parts for Land Rovers. The company uses an activity-based costing system for Internal decision-making purposes. The company has four activity cost pools as listed below: Activity Cost Pool Order size Activity Measure Number of direct labor-hours Activity Rate $ 17.70 per direct labor-hour $ 358.80 per custoner order $ 78.08 per testing hour $ 1,492.00 per sales call Customer orders Number of custoner orders Product testing Selling Number of testing hours Number of sales calls The managing director of the company would like Information concerning the cost of a recently completed order for heavy- duty traller axles. The order required 100 direct labor-hours. 17 hours of product testing, and 5 sales calls. Required: What is the total overhead cost assigned to the order for heavy-duty trailer axles? Activity Cost Pool ABC Cost Order size Customer orders Product testing Selling Total overhead cost

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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Multiple Choice $9,907.97 $89,171.73 $5,173.02 $136.51
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Helm Corporation uses an activity-based costing system with three activity cost pools. The company has provided the following data concerning its costs and its activity based costing system: Costs: Manufacturing overhead Selling and administrative expenses Total Distribution of resource consumption: Manufacturing overhead Selling and administrative expenses $304,500 $493,000 Activity Cost Pools Customer Support 85% 20% O $116,000 O $428,000 Order Size 5% 60% S S Other 10% 20% The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. You have been asked to complete the first-stage allocation of costs to the activity cost pools. How much cost, in total, would be allocated in the first-stage allocation to the Customer Support activity cost 480,000 100,000 580,000 Total 100% 100%
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