Exercise 4-8 (Algo) Computing ABC Product Costs [LO4-2, LO4-3] [The following information applies to the questions displayed below.] Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow: Annual Production 18,000 units 76,000 units Additional information about the company follows: a. Rims require $10 in direct materials per unit, and Posts require $7. b. The direct labor wage rate is $17 per hour. c. Rims are more complex to manufacture than Posts and they require special equipment. d. The ABC system has the following activity cost pools: Direct Labor- Hours per unit 0.40 0.80 Rims Posts
Exercise 4-8 (Algo) Computing ABC Product Costs [LO4-2, LO4-3] [The following information applies to the questions displayed below.] Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow: Annual Production 18,000 units 76,000 units Additional information about the company follows: a. Rims require $10 in direct materials per unit, and Posts require $7. b. The direct labor wage rate is $17 per hour. c. Rims are more complex to manufacture than Posts and they require special equipment. d. The ABC system has the following activity cost pools: Direct Labor- Hours per unit 0.40 0.80 Rims Posts
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
am.103.
![Exercise 4-8 (Algo) Computing ABC Product Costs [LO4-2, LO4-3]
[The following information applies to the questions displayed below.]
Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow:
Direct Labor-
Hours per unit
0.40
0.80
Rims
Posts
18,000 units
76,000 units
Additional information about the company follows:
a. Rims require $10 in direct materials per unit, and Posts require $7.
b. The direct labor wage rate is $17 per hour.
c. Rims are more complex to manufacture than Posts
d. The ABC system has the following activity cost pools:
Activity Cost Pool
Machine setups
Special processing
General factory
Annual
Production
Exercise 4-8 (Algo) Part 2
Activity Measure
Number of setups
Machine-hours
Direct labor-hours
$
> Answer is complete but not entirely correct.
Unit product cost of Rims
Unit product cost of Posts
they require special equipment.
21.80 x
30.60 X
Estimated
Overhead Cost
$ 25,080
$ 122,360
$ 702,000
Estimated Activity
Rims
80
2,000
7,200
Posts
220
0
60,800
2. Determine the unit product cost of each product according to the ABC system. (Do not round intermediate calculations. Round
your final answers to 2 decimal places.)
Total
300
2,000
68,000](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2478f192-ec9a-469b-901c-843675e8f26b%2Fedbdb4a2-43f9-47fe-82b0-d3a226b3b92c%2Fcufxisc_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Exercise 4-8 (Algo) Computing ABC Product Costs [LO4-2, LO4-3]
[The following information applies to the questions displayed below.]
Performance Products Corporation makes two products, titanium Rims and Posts. Data regarding the two products follow:
Direct Labor-
Hours per unit
0.40
0.80
Rims
Posts
18,000 units
76,000 units
Additional information about the company follows:
a. Rims require $10 in direct materials per unit, and Posts require $7.
b. The direct labor wage rate is $17 per hour.
c. Rims are more complex to manufacture than Posts
d. The ABC system has the following activity cost pools:
Activity Cost Pool
Machine setups
Special processing
General factory
Annual
Production
Exercise 4-8 (Algo) Part 2
Activity Measure
Number of setups
Machine-hours
Direct labor-hours
$
> Answer is complete but not entirely correct.
Unit product cost of Rims
Unit product cost of Posts
they require special equipment.
21.80 x
30.60 X
Estimated
Overhead Cost
$ 25,080
$ 122,360
$ 702,000
Estimated Activity
Rims
80
2,000
7,200
Posts
220
0
60,800
2. Determine the unit product cost of each product according to the ABC system. (Do not round intermediate calculations. Round
your final answers to 2 decimal places.)
Total
300
2,000
68,000
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