Identify a cost driver that may be used to assign each cost pool to each line of snowmobiles.Budgeted CostsCost DriverMachine setup, indirect materialsInspectionsTestsInsurance, plantEngineering designDepreciation, machineryMachine setup, indirect laborProperty taxesOil, heatingElectricity, plant lightingEngineering prototypesDepreciation, plantElectricity, machineryMachine maintenance wages

1). Machine setup, indirect materials - Number of setups.2). Inspections - Number of…

Answered: Identify a cost driver that may be used…

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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Identifying Cost Drivers. Palisades Company identified the activities listed in the following as being most important (step 1 and step 2 of activity-based costing), and it formed cost pools for each activity: 1. Purchasing raw materials 2. Inspecting raw materials 3. Storing raw materials 4. Maintaining production equipment 5. Setting up machines to produce batches of product 6. Testing finished products Required: Perform step 3 of the activity-based costing process by identifying a possible cost driver for each activity.
please answer within the format by providing formula the detailed workingPlease provide answer in text (Without image)Please provide answer in text (Without image)Please provide answer in text (Without image) Question Content Area Activity rates and product costs using activity-based costing Idris Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Activity BudgetedActivity Cost Activity Base Casting $640,000 Machine hours Assembly 125,000 Direct labor hours Inspecting 30,000 Number of inspections Setup 28,000 Number of setups Materials handling 20,000 Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Entry Dining Total Machine hours 7,500 12,500 20,000…
implementing an activity-based costing system that has four activity cost pools: Travel, Pickup and Delivery, Customer Service, and Other. The activity measures are miles for the Travel cost pool, number of pickups and deliveries for the Pickup and Delivery cost pool, and number of customers for the Customer Service cost pool. The Other cost pool has no activity measure because it is an organization-sustaining activity. The following costs will be assigned using the activity-based costing system Driver and guard wages Vehicle operating expense Vehicle depreciation. Customer representative salaries and i expenses office expenses Driver and guard wages Vehicle operating expense Vehicle depreciation Customer representative salaries and expenses office expenses Administrative expenses Administrative expenses Total cost The distribution of resource consumption across the activity cost pools is as follows. Pickup and Delivery 35% 5% $1,000,000 510,000 390,000 Driver and guard wages Vehicle…
23. Which of the following costs is relevant to a make-or-buy decision of a particular part of a product? a.The direct labor costs used to manufacture the part b.The depreciation on the plant used to manufacture the part c.The fixed annual rent paid for the office building d.The salary of the sales manager who sells the product
Support department cost allocation Hooligan Adventure Supply produces and sells various outdoor equipment. The Molding and Assembly production departments are supported by the Personnel and Maintenance departments. Personnel costs are allocated to the production departments based on the number of employees, and Maintenance costs are allocated based on number of service calls. Information about these departments is detailed in the following table: Line Item Description PersonnelDepartment MaintenanceDepartment MoldingDepartment AssemblyDepartment Number of employees 28 10 41 49 Number of service calls 57 41 168 112 Department cost $15,000 $11,400 $72,000 $69,000 1. Which of the following statements matches the sequential method of cost allocations?a. Support departments are often allocated in order from lowest to the highest cost with preference given to the departments that serve few support…
Classify each Direct or indirect cost a. Cost to lease (rent) railroad cars b. Cost of track and bed (ballast) replacement c. Diesel fuel costs d. Cost to lease (rent) train locomotives e. Depreciation of terminal facilities f. Maintenance costs of right-of-way, bridges, and buildings g. Salaries of dispatching and communications personnel h. Headquarters information technology support staff salaries i. Safety training costs j. Wages of train engineers k. Wages of switch and classification yard personnel I. Costs of accident cleanup
What is the measured mile approach used for?a. Calculate budget spentb. Measure office overheadc. Calculate loss of productivityd. Measure unit costs on site
Which of the following activity bases would be appropriate to use for materials handling? A. Number of machine hours B. Number of material moves C. Number of production orders D. Kilowatt-hours used
Which of the following costs at a manufacturing company would be treated as a product cost under variable costing? Multiple Choice direct material cost property taxes on the factory building sales manager's salary sales commissions
Which of the following costs is best classified as a fixed cost with respect to volume of activity? (See your Chapter 20 notes, page 5) Direct labor Electricity used to heat, light, and cool a factory Cleaning supplies used in an automobile assembly plant Straight-line depreciation expense of a machine used in a factory Total cost of salaries paid to quality inspectors in a manufacturing plant Tires used in an automobile manufacturing plant
Classifying costsThe following is a list of costs that were incurred in the production andsale of lawn mowers: a. Premiums on insurance policy for factory buildingsb. Tires for lawn mowersc. Filter for spray gun used to paint the lawn mowersd. Paint used to coat the lawn mowers, the cost of which isimmaterial to the cost of the final product e. Plastic for outside housing of lawn mowersf. Salary of factory supervisorg. Hourly wages of operators of robotic machinery used inproduction h. Engine oil used in mower engines prior to shipmenti. Salary of vice president of marketingj. Property taxes on the factory building and equipmentk. Cost of advertising in a national magazine1. Gasoline engines installed in the lawn mowers m. Electricity used to run the robotic machineryn. Straight-line depreciation on the robotic machinery used tomanufacture the lawn mowerso. Salary of quality control supervisor who inspects each lawnmower before it is shipped p. Attorney fees for drafting a new lease…
Technical feasibility analyzes the availability of technology and resources. This type of analysis helps companies determine whether new technology is feasible or not. It is used when new technology is first developed, prior to use. Machinery and Office equipment(building materials company)

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