Exercise 7-13 (Algo) Computing ABC Product Costs [LO7-3, LO Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit 0.90 0.50 Annual Production 24,000 units 49,000 units Hubs Sprockets Additional information about the company follows: a. Hubs require $28 in direct materials per unit, and Sprockets require $16. b. The direct labor wage rate is $13 per hour. c. Hubs require special equipment and are more complex to manufacture than Sprockets. d. The ABC system has the following activity cost pools: Activity Cost Pool (Activity Measure) Machine setups (number of setups) Special processing (machine-hours) General factory (organization-sustaining) Estimated Overhead Cost $ 17,280 $ 164,500 $ 266,600 Hubs 80 4,700 ΝΑ Activity Sprockets 64 0 ΝΑ Total 144 4,700 ΝΑ
Exercise 7-13 (Algo) Computing ABC Product Costs [LO7-3, LO Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit 0.90 0.50 Annual Production 24,000 units 49,000 units Hubs Sprockets Additional information about the company follows: a. Hubs require $28 in direct materials per unit, and Sprockets require $16. b. The direct labor wage rate is $13 per hour. c. Hubs require special equipment and are more complex to manufacture than Sprockets. d. The ABC system has the following activity cost pools: Activity Cost Pool (Activity Measure) Machine setups (number of setups) Special processing (machine-hours) General factory (organization-sustaining) Estimated Overhead Cost $ 17,280 $ 164,500 $ 266,600 Hubs 80 4,700 ΝΑ Activity Sprockets 64 0 ΝΑ Total 144 4,700 ΝΑ
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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![Exercise 7-13 (Algo) Computing ABC Product Costs [LO7-3, LO7-4]
Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow:
Direct Labor-Hours
per Unit
0.90
0.50
Annual Production
24,000 units
49,000 units
Hubs
Sprockets
Additional information about the company follows:
a. Hubs require $28 in direct materials per unit, and Sprockets require $16.
b. The direct labor wage rate is $13 per hour.
c. Hubs require special equipment and are more complex to manufacture than Sprockets.
d. The ABC system has the following activity cost pools:
Activity Cost Pool (Activity Measure)
Machine setups (number of setups)
Special processing (machine-hours)
General factory (organization-sustaining)
Estimated Overhead
Cost
$ 17,280
$164,500
$ 266,600
Hubs
80
4,700
ΝΑ
Activity
Sprockets
64
0
ΝΑ
Total
144
4,700
ΝΑ](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F902b6328-d5d0-4c0b-8290-aafdf8186a48%2Fd126df57-6f8d-4afa-9cf7-f52ae1423215%2Folf4vab_processed.png&w=3840&q=75)
Transcribed Image Text:Exercise 7-13 (Algo) Computing ABC Product Costs [LO7-3, LO7-4]
Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow:
Direct Labor-Hours
per Unit
0.90
0.50
Annual Production
24,000 units
49,000 units
Hubs
Sprockets
Additional information about the company follows:
a. Hubs require $28 in direct materials per unit, and Sprockets require $16.
b. The direct labor wage rate is $13 per hour.
c. Hubs require special equipment and are more complex to manufacture than Sprockets.
d. The ABC system has the following activity cost pools:
Activity Cost Pool (Activity Measure)
Machine setups (number of setups)
Special processing (machine-hours)
General factory (organization-sustaining)
Estimated Overhead
Cost
$ 17,280
$164,500
$ 266,600
Hubs
80
4,700
ΝΑ
Activity
Sprockets
64
0
ΝΑ
Total
144
4,700
ΝΑ
Transcribed Image Text:Required:
1. Compute the activity rate for each activity cost pool.
2. Determine the unit product cost of each product according to the ABC system.
Complete this question by entering your answers in the tabs below.
Required 1 Required 2
Compute the activity rate for each activity cost pool.
Activity Cost Pool
Activity Rate
per setup
Machine setups
Special processing
per MH
Required:
1. Compute the activity rate for each activity cost pool.
2. Determine the unit product cost of each product according to the ABC system.
Required 1 Required 2
Complete this question by entering your answers in the tabs below.
< Required 1
Direct materials
Direct labor
Overhead
Unit cost
Determine the unit product cost of each product according to the ABC system. (Do not round intermediate calculations. Round.
your answers to 2 decimal places.)
Hubs
Required 2 >
Sprockets
< Required 1
Required 2
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