Lens Care Inc. (LCI) manufactures specialized equipment for polishing optical lenses.There are two models - one mainly used for fine eyewear (F-32) and another forlenses used in binoculars, cameras, and similar equipment (B-13).The manufacturing cost of each unit is calculated using activity-based costing, usingthe following manufacturing cost pools:Cost PoolsMaterials handlingManufacturingsupervisionAssemblyMachine setupInspection and testingAllocation BaseNumber of partsHours of machinetimeNumber of partsEach setupLogged hoursCosting Rate$2.40 Perpart$$14.8per$ 3.30 Perpart$Ohour56.5 Persetu045.5perOhour19.5perPackagingLogged hours$OhourLCI currently sells the B-13 model for $1,775 and the F-32 model for $1,220.Manufacturing costs and activity usage for the two products are as follows: LCI currently sells the B-13 model for $1,775 and the F-32 model for $1,220.Manufacturing costs and activity usage for the two products are as follows:Direct materialsNumber of partsMachine hoursInspection timeB-13164.501607.901.700.9034625155334$F-3275.601204.200.80$0.5Packaging time02SetupsThe market price for B-13 and F-32 are reduced to $1,695 and $1,095 respectively.To achieve the target cost, Lens Care plans to reduce materials handling costs. Howmany parts must be removed from B-13 in order to achieve the target cost for B-13(round up to whole units)?

Activity-Based Costing is a system where overhead costs are assigned to the product on the basis of…

LCI currently sells the B-13 model for $1,775 and the F-32 model for $1,220. Manufacturing costs and activity usage for the two products are as follows: Direct materials Number of parts Machine hours Inspection time 46 25 15 B-13 164 .50 160 7.9 0 1.7 0 53 34 $ 0.8 0 0.5 Packaging time 0 2 Setups The market price for B-13 and F-32 are reduced to $1,695 and $1,095 respectively. To achieve the target cost, Lens Care plans to reduce materials handling costs. How many parts must be removed from B-13 in order to achieve the target cost for B-13 (round up to whole units)? 0.9 F-32 75. 60 0 3 $ 120 4.2 0

LCI currently sells the B-13 model for $1,775 and the F-32 model for $1,220. Manufacturing costs and activity usage for the two products are as follows: Direct materials Number of parts Machine hours Inspection time 46 25 15 B-13 164 .50 160 7.9 0 1.7 0 53 34 $ 0.8 0 0.5 Packaging time 0 2 Setups The market price for B-13 and F-32 are reduced to $1,695 and $1,095 respectively. To achieve the target cost, Lens Care plans to reduce materials handling costs. How many parts must be removed from B-13 in order to achieve the target cost for B-13 (round up to whole units)? 0.9 F-32 75. 60 0 3 $ 120 4.2 0

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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