HITech Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. Thecompany, which uses activity-based costing, has identified five activities (and related cost drivers). Eachactivity, its budgeted cost, and related cost driver is identified below.ActivityMaterial handlingMaterial insertionCost$ 225,000Cost DriverNumber of partsNumber of partsAutomated machineryFinishingPackagingTotal2,475,000840,000170,000170.000$3,880,000Machine hoursDireet labor hoursOrders shippedThe following information pertains to the three product lines for next year:Economy10,000Standard5,000500Deluxe2,000200Units to be producedOrders to be shippedNumber of parts per unitMachine hours per unitLabor hours per unit1,00010152513522Assume that HITech is using a volume-based costing system, and the preceding overhead costs are appliedto all products on the basis of direct labor hours. The overhead cost that would be assigned to theStandard product line is closest to:

Cost Accounting: It is the process of collecting, recording, analyzing the cost, summarizing cost,…

HITech Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below. Activity Material handling Material insertion Automated machinery Finishing Packaging Total Cost $ 225,000 2,475,000 840,000 170,000 Cost Driver Number of parts Number of parts Machine hours Direct labor hours Orders shipped 170.000 $3,880,000 The following information pertains to the three product lines for next year: Economy 10,000 1,000 Standard 5,000 500 Deluxe 2,000 200 Units to be produced Orders to be shipped Number of parts per unit Machine hours per unit Labor hours per unit 25 5 10 1 2 15 3 2 Assume that HiTech is using a volume-based costing system, and the preceding overhead costs are applied to all products on the basis of direct labor hours. The overhead cost that would be assigned to the Standard product line is closest to:

HITech Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below. Activity Material handling Material insertion Automated machinery Finishing Packaging Total Cost $ 225,000 2,475,000 840,000 170,000 Cost Driver Number of parts Number of parts Machine hours Direct labor hours Orders shipped 170.000 $3,880,000 The following information pertains to the three product lines for next year: Economy 10,000 1,000 Standard 5,000 500 Deluxe 2,000 200 Units to be produced Orders to be shipped Number of parts per unit Machine hours per unit Labor hours per unit 25 5 10 1 2 15 3 2 Assume that HiTech is using a volume-based costing system, and the preceding overhead costs are applied to all products on the basis of direct labor hours. The overhead cost that would be assigned to the Standard product line is closest to:

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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