Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Hubs Sprockets Unit 0.70 0.30 Annual Production 28,000 units 45,000 units Additional information about the company follows: a. Hubs require $34 in direct materials per unit, and Sprockets require $17 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) Estimated Overhead Cost $ 24,750 $220,000 $ 208,600 Hubs 110 Activity Sprockets 88 Total 4,400 0 NA NA 198 4,400 NA Machine setups (number of setups) Special processing (machine-hours) General factory (organization-sustaining) 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.

Fogerty Company makes two products-titanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Hubs Sprockets Unit 0.70 0.30 Annual Production 28,000 units 45,000 units Additional information about the company follows: a. Hubs require $34 in direct materials per unit, and Sprockets require $17 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) Estimated Overhead Cost $ 24,750 $220,000 $ 208,600 Hubs 110 Activity Sprockets 88 Total 4,400 0 NA NA 198 4,400 NA Machine setups (number of setups) Special processing (machine-hours) General factory (organization-sustaining) 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.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

See similar textbooks

Similar questions

Jeff, a 56 year old professor is subject to a 28% tax rate. He has had a family emergency and must withdraw $5,000 from his IRA to fund it. How much money will he owe the government for this withdrawal?
A compulsary legal and unilateral payment made to the government is known as _______
Analyse how macro environmental factors ( PESTLE) affect a hotel organization.

Recommended textbooks for you

ENGR.ECONOMIC ANALYSIS

Economics

ISBN:

9780190931919

Author:

NEWNAN

Publisher:

Oxford University Press