Exercise 7-11 (Algo) Second-Stage Allocation and Margin Calculations [LO7-4, LO7-5] Foam Products, Incorporated, makes foam seat cushions for the automotive and aerospace Industries. The company's activity-based costing system has four activity cost pools, which are listed below along with their activity measures and activity rates: Activity Cost Pool Supporting direct labor Batch processing Order processing Customer service Activity Measure Number of direct labor-hours Number of batches Number of orders Number of customers The company Just completed a single order from Interstate Trucking for 1,700 custom seat cushions. The order was produced in three batches. Each seat cushion required 0.6 direct labor-hour. The selling price was $141.80 per unit, the direct materials cost was $107 per unit, and the direct labor cost was $13.80 per unit. This was Interstate Trucking's only order during the year. Required: Calculate the customer margin for Interstate Trucking. Costs: Interstate Trucking Customer Margin-ABC Analysis Customer margin S 0 Activity Rate $ 13 per direct labor-hour $ 92 per batch $ 276 per order $ 2,628 per customer 0

Exercise 7-11 (Algo) Second-Stage Allocation and Margin Calculations [LO7-4, LO7-5] Foam Products, Incorporated, makes foam seat cushions for the automotive and aerospace Industries. The company's activity-based costing system has four activity cost pools, which are listed below along with their activity measures and activity rates: Activity Cost Pool Supporting direct labor Batch processing Order processing Customer service Activity Measure Number of direct labor-hours Number of batches Number of orders Number of customers The company Just completed a single order from Interstate Trucking for 1,700 custom seat cushions. The order was produced in three batches. Each seat cushion required 0.6 direct labor-hour. The selling price was $141.80 per unit, the direct materials cost was $107 per unit, and the direct labor cost was $13.80 per unit. This was Interstate Trucking's only order during the year. Required: Calculate the customer margin for Interstate Trucking. Costs: Interstate Trucking Customer Margin-ABC Analysis Customer margin S 0 Activity Rate $ 13 per direct labor-hour $ 92 per batch $ 276 per order $ 2,628 per customer 0

Name: Exercise 7-11 (Algo) Second-Stage Allocation and Margin Calculations
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Description: Exercise 7-11 (Algo) Second-Stage Allocation and Margin Calculations [LO7-4, LO7-5]Foam Products, Incorporated, makes foam seat cushions for the automotive and aerospace Industries. The company's activity-basedcosting system has four activity cost p

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
Vanvalkenburg. Inc., manufactures and sells two products: Product GQ5 and Product JO. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Expected Activity Activity Overhead Activity Cost Pools Measures Cost Product Q5 Product JØ Total Labor-related DLHS $191,748 70,536 295,592 Production orders 3,000 2,800 5,800 orders 300 500 800 Order size MHs 4,300 4,500 8,800 $557,876 The activity rate for the Order Size activity cost pool under activity-based costing is closest to: Multiple Cholce $36.23 per MH $68.48 per MH $96.19 per MH
TB MC Qu. 4-49 Boesenhofer, Inc., manufactures and sells... Boesenhofer, Inc., manufactures and sells two products: Product N6 and Product N7. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity Estimated Expected Activity Activity Overhead Activity Cost Pools Measures Cost Product N6 Product N7 Labor-related DLHS Total $345,060 128,534 107,598 2,100 600 4,100 Machine setups 5,000 800 3,800 setups 7,100 Order size MHs 1,400 7,900 $581,192 The activity rate for the Machine Setups activity cost pool is closest to: Multiple Cholce $73.57 per setup $91.81 per setup Prev of 36 Next > 10:54 AM 66°F Mostly cloudy 目。 21 10/20/2021 pe here to search DELL Home End Delete PgUp PgDn F12 PrtScr Insert F10 F11 F8 F9 F7 F4 F5 F6 F3 Num Lock Backspace & %23 %24
3 2. An intern suggested that the company use activity-based costing to cost its products. A team was formed to investigate this idea, and it came back with the recommendation that four activity cost pools be used. These cost pools and their associated activities follow: 5 ints 00:40:40 Activity Cost Pool and Activity Measure Purchase orders (number of orders) Rework requests (number of requests) Product testing (number of tests) Machine related (machine-hours) Activity Cost Pool Purchase orders Rework requests Product testing Machine related Estimated Overhead Cost $ 170,000 374,400 350,000 1,150,000 $2,044,400 Compute the activity rate (i.e., predetermined overhead rate) for each of the activity cost pools. Activity Rate per order per request per test per MH Deluxe 1,000 600 5,000 18,000 Activity Regular 1,500 1,200 12,500 28,000 Total 2,500 1,800 17,500 46,000 3. Assume that actual activity is as expected for the year. Using activity-based costing, do the following: a. Determine the…
Angel Corporation uses activity-based costing to determine product costs for external financial reports. The company has provided the following data concerning its activity-based costing system: Activity Cost Pools (and Activity Measures) Machine related (machine-hours) Estimated Overhead Cost $323,840 $363,000 $258,420 Batch setup (setups) Order size (direct labor-hours) Expected Activity Activity Cost Pools Machine related Product X Product Y Total 5,400 10,800 4,400 7,400 2,400 7,400 12,800 Batch setup 13,200 11,800 Order size Assuming that actual activity turns out to be the same as expected activity, the total amount of overhead cost allocated to Product X would be closest to: (Round your intermediate calculations to 2 decimal places.)
Exercise 4-5 (Static) Assigning Overhead to Products in ABC [LO4-2, LO4-3] Sultan Company uses an activity-based costing system. At the beginning of the year, the company made the following estimates of cost and activity for its five activity cost pools: Activity Cost Pool Activity Measure Expected Overhead Cost Expected Activity Labor-related Direct labor-hours $ 156,000 26,000 DLHs Purchase orders Number of orders $ 11,000 220 orders Parts management Number of part types $ 80,000 100 part types Board etching Number of boards $ 90,000 2,000 boards General factory Machine-hours $ 180,000 20,000 MHs Required: 1. Compute the activity rate for each of the activity cost pools. 2. The expected activity for the year was distributed among the company’s four products as follows: Activity Cost Pool Expected Activity Product A Product B Product C Product D Labor-related (DLHs) 6,000 11,000 4,000 5,000 Purchase orders (orders) 60 30 40 90 Parts management (part…
Garrell Corporation is conducting a time-driven activity-based costing study in its Customer Support Department. The company has provided the following data to aid in that study: Time-driven activity rate (cost per unit of activity) Activity cost pool: Receiving Calls Resolving Issues Settling Disputes Cost Object Data: Number of calls received Number of issues resolved Number of disputes settled Customer P 31 17 1 $5.46 $8.58 $13.26 Customer Q 21 10 Required: Using time-driven activity-based costing, determine the total Customer Support Department cost assigned to cach customer.
Roca, Incorporated, manufactures and sells two products: Product M6 and Product X7. The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Overhead Cost Activity Cost Pools Labor-related Production orders Order size Multiple Choice O $360,294 O $443.424 O $369,879 Activity Measures DLHs orders MHS O $249,264 $ 152,100 63,035 505,452 $ 720,587 The total overhead applied to Product X7 under activity-based costing is closest to: (Round your Intermediate calculations to 2 decimal places.) Expected Activity Product M6 Product X7 3,000 400 4,800 300 3,700 3,600 saved Total 7,800 700 7,300
- Chapter Four Activity Cost Pool Machining Machine setups Production design General factory Activity Measure Machining Required information Greenwood Company manufactures two products-13,000 units of Product Y and 5,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity- based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Number of setups Number of products Direct labor-hours Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Activity rate Saved Product Y Product Z 8,800 3,200 240 40 1 1 8,800 3,200 5. What is the activity rate for the Product Design activity cost pool? per product Save
Doles Corporation uses the following activity rates from its activity-based costing to assign overhead costs to products. Activity Cost Pools Setting up batches Processing customer orders Assembling products Data concerning two products appear below: Number of batches Number of customer orders Number of assembly hours Total overhead cost Activity Rate $69.22 per batch $26.28 per customer order $ 12.11 per assembly hour Product K52W 65 45 418 Required: How much overhead cost would be assigned to each of the two products using the company's activity-based costing system? (Round your intermediate calculations and final answers to 2 decimal places.) Product K52W Product X94T Product X94T 52 30 161
Assume a company's activity-based costing system includes three activities with the following activity rates: Activity Cost Pool Activity Rate Travel $ 2 per mile driven Deliveries $ 50 per delivery Customer service $ 22 per phone call Two of the company's many customers include Customer A and Customer B. These two customers consumed the company's activities as follows: Total Expected Activity Customer A Customer B Travel (number of miles driven) 300 250 Deliveries (number of deliveries) 15 5 Customer service (number of phone calls) 20 12 If the company earned $1,130 in revenue serving Customer B, then what is the customer margin for this customer? Multiple Choice $96 $156 $116 $136
Howard Corporation manufactures two products: Product B820 and Product P99Y. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products B820 and P99Y. Activity Cost Pool Activity Measure Machining Machine setups Product design Order size Activity Measure Machine-hours Number of setups Number of products Direct labor-hours O $704,200 $301,800 Machine-hours Number of setups Number of products Direct labor-hours O $610,000 O $503,000 Total Cost $ 330,000 $ 300,000 S 46,000 2 products $ 330,000 10,000 DLHs Total Activity 15,000 MHs 500 setups Product B820 7,000 200 1 3,000 Using the plantwide overhead rate, how much manufacturing overhead cost would be allocated to Product B820? Product P99Y 8,000 300 1 7,000