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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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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