Elerie, Incorporated, manufactures and sells two products Product G8 and Product 00. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below Activity Cost Pools Labor-related Hours Product C 3,621 Product 00 651 Total direct labor-hours 4,272 The direct labor rate is $22.20 per DLH. The direct materials cost per unit for each product is given below Direct Materials Cost per Unit $114.10 Product GB Product 00 $ 114.50 The company is considering adopting an activity based costing system with the following activity cost pools, activity measures, and expected activity Machine setups Order sice Direct Labor- Expected Hours Per Production Unit 710 5.1 310 2.1 Multiple Choice Activity Measures DENG setupe Mila Estimated Overbead Cost $56,055 Total Direct Labor- 54,890 366,008 $476,953 Expected Activity Product C# Product 00 3,621 450 4,450 651 605 5.200 Which of the following statements concerning the unit product cost of Product GB is true? (Round your intermediate calculations to 2 decimal places) Total 4,272 1,055 10,050 The unit product cost of Product GB under sactional costsing is less than its unit product cost under activity based costing by $22075 The unit product cost of Product GB under traditional casting a greater than to unit product under activity based costing by $340 83 Prey 4 at 20 Next >
Elerie, Incorporated, manufactures and sells two products Product G8 and Product 00. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below Activity Cost Pools Labor-related Hours Product C 3,621 Product 00 651 Total direct labor-hours 4,272 The direct labor rate is $22.20 per DLH. The direct materials cost per unit for each product is given below Direct Materials Cost per Unit $114.10 Product GB Product 00 $ 114.50 The company is considering adopting an activity based costing system with the following activity cost pools, activity measures, and expected activity Machine setups Order sice Direct Labor- Expected Hours Per Production Unit 710 5.1 310 2.1 Multiple Choice Activity Measures DENG setupe Mila Estimated Overbead Cost $56,055 Total Direct Labor- 54,890 366,008 $476,953 Expected Activity Product C# Product 00 3,621 450 4,450 651 605 5.200 Which of the following statements concerning the unit product cost of Product GB is true? (Round your intermediate calculations to 2 decimal places) Total 4,272 1,055 10,050 The unit product cost of Product GB under sactional costsing is less than its unit product cost under activity based costing by $22075 The unit product cost of Product GB under traditional casting a greater than to unit product under activity based costing by $340 83 Prey 4 at 20 Next >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Ellerie, Incorporated, manufactures and sells two products Product G8 and Product 00. Data concerning the expected production of each product and the expected total direct labor hours (DLH) required to
produce that output appear below:
Activity Cost Pools
Labor-related
Expected Hours Per
Production Unit
710
5.1
310
2.1
Product CB
Product 00
Total direct labor-hours
The direct labor rate is $22.20 per DLH. The direct materials cost per unit for each product is given below
Direct
Materials
Cost per
Unit
$114.10
$ 114.50
Machine setups
Order sice
Direct
Labor-
Product CB
Product 00
The company is considering adopting an activity based costing system with the following activity cost pools, activity measures, and expected activity
Estimated
Overhead
Multiple Choice
Activity
Measures
Total
Direct
Labor-
Hours
3,621
651
4,272
Cost
$56,055
54,890
366,008
$ 476,953
Which of the following statements concerning the unit product cost of Product GB is true? (Round your intermediate calculations to 2 decimal places)
DENS
setups
Mia
Expected Activity
Product C# Product 00
3,621
450
4,850
651
605
5.200
Total
4,272
1,055
10,050
The unit product cost of Product GB under traditional cousing is less than its unit product cost under activity based costing by $22075
The unit product cost of Product GB under traditional casting a greater than is unit product under activity based costing by $34083
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Step 1: Introduction of Activity base costing
VIEWStep 2: Calculation of Activity rates
VIEWStep 3: Calculation of Allocated overhead and Cost of Product as per activity base costing
VIEWStep 4: Calculation of Product cost as per Traditional approach
VIEWStep 5: Calculation of net effect in costing under both approach
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