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Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two pre Direct Labor-Hours per Unit 0.60 0.20 Annual Production 14,000 units 41,000 units Hubs Sprockets Additional information about the company follows: a. Hubs require $38 in direct materials per unit, and Sprockets require $18. b. The direct labor wage rate is $16 per hour. d. c. Hubs require special equipment and are more complex to manufacture than Sprockets. The ABC system has the following activity cost pools: Estimated Overhead Activity ferockets Total

Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two pre Direct Labor-Hours per Unit 0.60 0.20 Annual Production 14,000 units 41,000 units Hubs Sprockets Additional information about the company follows: a. Hubs require $38 in direct materials per unit, and Sprockets require $18. b. The direct labor wage rate is $16 per hour. d. c. Hubs require special equipment and are more complex to manufacture than Sprockets. The ABC system has the following activity cost pools: Estimated Overhead Activity ferockets Total

FINANCIAL ACCOUNTING
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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Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Hubs Sprockets Additional information about the company follows: 0.60 0.20 a. Hubs require $38 in direct materials per unit, and Sprockets require $18. b. The direct labor wage rate is $16 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: Annual Production 14,000 units 41,000 units Activity Cost Pool (Activity Measure) Machine setups (number of setups) Special processing (machine-hours) General factory (organization-sustaining) Direct materials Direct labor Overhead Unit cost Complete this question by entering your answers in the tabs below. $ 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. Estimated Overhead Cost $ 29,250 $ 135,000 $ 164,200 0.00 $ Hubs 0.00 125 4,500 NA Required 1 Required 2 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 Sprockets Activity Sprockets 100 0 NA Total 225 4,500 NA
Transcribed Image Text:Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Hubs Sprockets Additional information about the company follows: 0.60 0.20 a. Hubs require $38 in direct materials per unit, and Sprockets require $18. b. The direct labor wage rate is $16 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: Annual Production 14,000 units 41,000 units Activity Cost Pool (Activity Measure) Machine setups (number of setups) Special processing (machine-hours) General factory (organization-sustaining) Direct materials Direct labor Overhead Unit cost Complete this question by entering your answers in the tabs below. $ 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. Estimated Overhead Cost $ 29,250 $ 135,000 $ 164,200 0.00 $ Hubs 0.00 125 4,500 NA Required 1 Required 2 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 Sprockets Activity Sprockets 100 0 NA Total 225 4,500 NA
Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit 0.60 0.20 Hubs Sprockets Additional information about the company follows: Annual Production 14,000 units 41,000 units a. Hubs require $38 in direct materials per unit, and Sprockets require $18. b. The direct labor wage rate is $16 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 Required 1 Required 2 Compute the activity rate for each activity cost pool. Activity Cost Pool Activity Rate Machine setups 130 per setup Special processing 30 per MH $ $ Cost $ 29,250 $ 135,000 $ 164,200 Complete this question by entering your answers in the tabs below. 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. Hubs 125 4,500 NA Activity Sprockets 100 0 ΝΑ Total 225 4,500 NA
Transcribed Image Text:Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit 0.60 0.20 Hubs Sprockets Additional information about the company follows: Annual Production 14,000 units 41,000 units a. Hubs require $38 in direct materials per unit, and Sprockets require $18. b. The direct labor wage rate is $16 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 Required 1 Required 2 Compute the activity rate for each activity cost pool. Activity Cost Pool Activity Rate Machine setups 130 per setup Special processing 30 per MH $ $ Cost $ 29,250 $ 135,000 $ 164,200 Complete this question by entering your answers in the tabs below. 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. Hubs 125 4,500 NA Activity Sprockets 100 0 ΝΑ Total 225 4,500 NA
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