Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows: Activity Activity Rate $27 per machine hour $10 per direct labor hour $55 per setup $28 per inspection $11 per production order $8 per purchase order The activity-base usage quantities and units produced for each product were as follows: Activity Base Elliptical Machines Treadmill Machine hours 1,011 Direct labor hours 152 Setups 14 Inspections 378 Production orders 15 Purchase orders Units produced Use the activity rate and usage information to determine the total activity cost and activity cost per unit for each product. If required, round the per unit answers to the nearest cent. Total Activity Cost Activity Cost Per Unit X X Fabrication Assembly Setup Inspecting Production scheduling Purchasing Elliptical Machines Treadmill 1,714 390 44 630 76 194 251 118 168 X X

Hercules Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows: Activity Activity Rate $27 per machine hour $10 per direct labor hour $55 per setup $28 per inspection $11 per production order $8 per purchase order The activity-base usage quantities and units produced for each product were as follows: Activity Base Elliptical Machines Treadmill Machine hours 1,011 Direct labor hours 152 Setups 14 Inspections 378 Production orders 15 Purchase orders Units produced Use the activity rate and usage information to determine the total activity cost and activity cost per unit for each product. If required, round the per unit answers to the nearest cent. Total Activity Cost Activity Cost Per Unit X X Fabrication Assembly Setup Inspecting Production scheduling Purchasing Elliptical Machines Treadmill 1,714 390 44 630 76 194 251 118 168 X X

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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Atlas Enterprises Inc. manufactures elliptical exercise machines and treadmills. The products are produced in its Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows: Activity Activity Rate Fabrication $27 per machine hour Assembly $11 per direct labor hour Setup $45 per setup Inspecting $23 per inspection Production scheduling $12 per production order Purchasing $9 per purchase order The activity-base usage quantities and units produced for each product were as follows: Activity Base Elliptical Machines Treadmill Machine hours 1,861 1,098 Direct labor hours 413 161 Setups 62 19 Inspections 615 369 Production orders 65 13 Purchase orders 211 129 Units produced 295 198 Use the activity rate and usage information to calculate the total activity cost and…
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