Leidenheimer Corporation manufactures small airplane propellers. Sales for year 2 totaled $1,730,000. Information regarding resources for the month follows. Resources Resources Supplied $ 69,000 107,000 100,000 71,000 54,000 Used $ 59,000 107,000 89,000 46,000 42,000 136,000 310,000 110,000 136,000 19,000 108,000 Parts management Energy Quality inspections Long-term labor Short-term 1abor Setups Materials Depreciation Marketing Customer service Administrative 220,000 310, 000 220,000 161,000 44,000 132,000 In addition, Leidenheimer spent $40,500 on 45 engineering changes with a cost-driver rate of $900 and $58,400 on 8 outside contracts with a cost driver rate of $7.300. Required: Management has requested that you do the following: a. Prepare a traditional income statement. b. Prepare an activity-based income statement.

Leidenheimer Corporation manufactures small airplane propellers. Sales for year 2 totaled $1,730,000. Information regarding resources for the month follows. Resources Resources Supplied $ 69,000 107,000 100,000 71,000 54,000 Used $ 59,000 107,000 89,000 46,000 42,000 136,000 310,000 110,000 136,000 19,000 108,000 Parts management Energy Quality inspections Long-term labor Short-term 1abor Setups Materials Depreciation Marketing Customer service Administrative 220,000 310, 000 220,000 161,000 44,000 132,000 In addition, Leidenheimer spent $40,500 on 45 engineering changes with a cost-driver rate of $900 and $58,400 on 8 outside contracts with a cost driver rate of $7.300. Required: Management has requested that you do the following: a. Prepare a traditional income statement. b. Prepare an activity-based income statement.

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter2: Basic Cost Management Concepts

Section: Chapter Questions

Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...

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Plato Company began operations on June 1, 2024. For its first month of operations, Plato Company established the following standards for one unit of its single product direct materials standard quantity 7 pounds 8 hours 8 hours standard price $14 per pound direct labor variable overhead $18 per hour $11 per hour Plato Company reported the following information for June: 1. 7,000 pounds of direct materials were purchased at a total cost of $113,750. 2. 5,400 direct labor hours were worked at a total cost of $75,600. 3. The variable overhead cost for the month totaled $52,950. 4. 460 units were produced. 5. At June 30, Plato Company had 3,200 pounds of direct materials on hand. Calculate the direct material quantity variance for June. If the variance is favorable, place a minus sign in front of your answer (i.e., -5000). If the variance is unfavorable, simply enter your answer as a number (i.e., 5000).
Digger Inc. sells a high-speed retrieval system for mining information. It provides the following information for the year. BudgetedActual Overhead cost$1,333, 2005 1, 307, 200Machine hours56, 30049, 000Direct labor hours101, 00097, 800Overhead is applied on the basis of direct labor hours. (a) Compute the predetermined overhead rate. (Round answer to 2 decimal places, e.g. 12.25.) Predetermined overhead rateSper direct labor hour
Air United, Inc. manufactures two products: missile range instruments and space pressure gauges. During April, 50 range instruments and 300 pressure gauges were produced, and overhead costs of $94,500 were estimated. An analysis of estimated overhead costs reveals the following activities. Activities Cost Drivers Total Cost 1. Materials handling Number of requisitions $40,000 2. Machine setups Number of setups 21,500 3. Quality inspections Number of inspections 33,000 $94,500 The cost driver volume for each product was as follows. Cost Drivers Instruments Gauges Total Number of requisitions 400 600 1,000 Number of setups 200 300 500 Number of inspections 200 400 600 (a) Determine the overhead rate for each activity. Overhead Rate Materials handling $enter a dollar amount per requisition per requisition Machine setups…
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Zeitgeist Company manufactures silicon sleeves for MP3 players. In August of last year, Zeitgeist began producing the colorful sleeves. During the month of August, 16,000 were produced, and 14,750 were sold at $6.95 each. The following costs were incurred: Direct materials $26,880 Direct labor 6,720 Variable overhead 5,920 Fixed overhead 28,160 A selling commission of 8% of sales price was paid. Administrative expenses, all fixed, amounted to $37,890. Required: 1. Calculate the unit cost and the cost of ending inventory under absorption costing. (Round unit cost to the nearest cent and cost of ending inventory to the nearest dollar.) 2. Calculate the unit cost and the cost of ending inventory under variable costing. (Round unit cost to the nearest cent and cost of ending inventory to the nearest dollar.) 3. What is the contribution margin per unit? (Round to the nearest cent.) 4. CONCEPTUAL CONNECTION: Zeitgeist believes that multicolored sleeves will really take off after one year of…
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Huxtable charges manufacturing overhead to products by using a predetermined application rate, computed on the basis of machine hours. The following data pertain to the current year: Budgeted manufacturing overhead: $430,000 Actual manufacturing overhead: $440,000 Budgeted machine hours: 20,000 Actual machine hours: 16,000 Overhead applied to production totaled: Select one: a. $352,000 b. $384,000 c. $550,000 d. $600,000 e. some other amount
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ACC Inc is working on calculating cost information for September. The beginning and ending inventories for the month of September are: 1-Sep 9/31/2023 Direct Materials $82,000 $77,000 Work in Process $121,000 $135,000 Finished Goods $58,000 $45,000 Production data for the month of September follows: Direct labor $175,500 Manufacturing overhead $185,500 Direct materials purchased $153,000 Using the above information answer the following questions: 1. What was the amount of direct materials added to production during the month? 2. What was the total amount of manufacturing cost added to production during the month? 3. What was the amount of cost of goods manufactured? 4. What was the amount of cost of goods sold?
Lucern Company reports the following for its overhead cost for the year. Budgeted Cost $ 31,200 Budgeted Activity Usage 60 design changes. 3,570 machine hours. 520 setups 42,840 83,200 Activity Engineering support Electricity Setup 1. Compute the activity rate for each activity using activity-based costing. 2. The company's Pro model used these activities to produce 1,000 units during the year: 2 design changes, 140 machine hours, and 15 setups. Allocate overhead cost to the Pro model and compute its overhead cost per unit using activity-based costing. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the activity rate for each activity using activity-based costing. Budgeted Cost Activity Engineering support Electricity Setup Activity Engineering support Electricity Setup Lucern Company reports the following for its overhead cost for the year. Budgeted Cost Budgeted Activity Usage $ 31,200 42,840 83,200 60 design changes 3,570 machine…
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