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Franklin Company produces commercial gardening equipment. Since production is highly automated, the company allocates overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead ac pools follow: Cost Cost driver Req A and B Unit Level $ 62,400 2,400 labor hours Req C Allocated overhead Direct cost Total cost per unit Desired profit Sales price Production of 710 sets of cutting shears, one of the company's 20 products, took 170 labor hours and 6 setups and consumed percent of the product-sustaining activities. Complete this question by entering your answers in the tabs below. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 710 units are produced. If direct product costs are $160 and the product is priced at 30 percent above cost for v price would the product sell under each allocation system? $ ABC $ 20,700 0.00 Activities Batch Level Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 710 units are produced. If direct product costs are $160 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Note: Round intermediate calculations and final answers to 2 decimal places. Labor Hours 0.00 $ 45 setups 0.00 Product Level $ 17,000 Percentage of use 0.00 Facility Leve $ 255,000 17,000 units Show less A

Franklin Company produces commercial gardening equipment. Since production is highly automated, the company allocates overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead ac pools follow: Cost Cost driver Req A and B Unit Level $ 62,400 2,400 labor hours Req C Allocated overhead Direct cost Total cost per unit Desired profit Sales price Production of 710 sets of cutting shears, one of the company's 20 products, took 170 labor hours and 6 setups and consumed percent of the product-sustaining activities. Complete this question by entering your answers in the tabs below. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 710 units are produced. If direct product costs are $160 and the product is priced at 30 percent above cost for v price would the product sell under each allocation system? $ ABC $ 20,700 0.00 Activities Batch Level Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 710 units are produced. If direct product costs are $160 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Note: Round intermediate calculations and final answers to 2 decimal places. Labor Hours 0.00 $ 45 setups 0.00 Product Level $ 17,000 Percentage of use 0.00 Facility Leve $ 255,000 17,000 units Show less A

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 5PA: Medical Tape makes two products: Generic and Label. It estimates it will produce 423,694 units of...
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Franklin Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity cost pools follow: Cost Cost driver Req A and B Unit Level $ 62,400 2,400 labor hours Req C Allocated overhead Direct cost Total cost per unit Desired profit Sales price Production of 710 sets of cutting shears, one of the company's 20 products, took 170 labor hours and 6 setups and consumed 15 percent of the product-sustaining activities. Complete this question by entering your answers in the tabs below. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 710 units are produced. If direct product costs are $160 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? $ Activities Batch Level $ 20,700 45 setups Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 710 units are produced. If direct product costs are $160 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Note: Round intermediate calculations and final answers to 2 decimal places. ABC 0.00 Labor Hours 0.00 $ Product Level $ 17,000 Percentage of use Facility Level $ 255,000 17,000 units 0.00 0.00 Show less A
Transcribed Image Text:Franklin Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity cost pools follow: Cost Cost driver Req A and B Unit Level $ 62,400 2,400 labor hours Req C Allocated overhead Direct cost Total cost per unit Desired profit Sales price Production of 710 sets of cutting shears, one of the company's 20 products, took 170 labor hours and 6 setups and consumed 15 percent of the product-sustaining activities. Complete this question by entering your answers in the tabs below. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 710 units are produced. If direct product costs are $160 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? $ Activities Batch Level $ 20,700 45 setups Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 710 units are produced. If direct product costs are $160 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Note: Round intermediate calculations and final answers to 2 decimal places. ABC 0.00 Labor Hours 0.00 $ Product Level $ 17,000 Percentage of use Facility Level $ 255,000 17,000 units 0.00 0.00 Show less A
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