Please Do not Give image format Cost DriverNumber of production runsQuality tests performedShipping orders processedTotal overheadRequired AHandheldHomeRequired:a. How much overhead will be assigned to each product if these three cost drivers are used to allocate overhead? What is the totalcost per unit produced for each product?Complete this question by entering your answers in the tabs below.b. How much overhead will be assigned to each product if direct labor cost is used to allocate overhead? What is the total cost per unitproduced for each product?Required BOverheadShow Transcribed TextCost DriverNumber of production runsQuality tests performedShipping orders processedTotal overheadCosts Assigned$ 450,000608,000176,000$1,234,000How much overhead will be assigned to each product if direct labor cost is used to allocate overhead? What is the total costper unit produced for each product? (Do not round intermediate calculations. Round "Total cost per unit" to 2 decimal places.)Required AActivity LevelHandheldHomeHandheldHomeTotal Cost perUnit4012110.Required B52050Costs Assigned$ 450,000608,000176,000$1,234,000OverheadTotal4532160CTotal Cost perUnit4012110Activity LevelHandheldHomeRequired:a. How much overhead will be assigned to each product if these three cost drivers are used to allocate overhead? Wcost per unit produced for each product?Complete this question by entering your answers in the tabs below.520b. How much overhead will be assigned to each product if direct labor cost is used to allocate overhead? What is theproduced for each product?50Total4532160How much overhead will be assigned to each product if these three cost drivers are used to allocate overhead? What is thetotal cost per unit produced for each product? (Round "Total Cost per Unit" to 2 decimal places.) Maglie Company manufactures two video game consoles: handheld and home. The handheld consoles are smaller and less expensivethan the home consoles. The company only recently began producing the home model. Since the introduction of the new product,profits have been steadily declining. Management believes that the accounting system is not accurately allocating costs to products,particularly because sales of the new product have been increasing.Management has asked you to investigate the cost allocation problem. You find that manufacturing overhead is currently assigned toproducts based on their direct labor costs. For your investigation, you have data from last year. Manufacturing overhead was$1,234,000 based on production of 300,000 handheld consoles and 109,000 home consoles. Direct labor and direct materials costswere as follows.Direct laborMaterialsHandheld$1,149,500790,000Home$393,000676,000Cost DriverNumber of production runsQuality tests performedShipping orders processedTotal overheadManagement has determined that overhead costs are caused by three cost drivers. These drivers and their costs for last year are asfollows.Total$1,542,5001,466,000Costs Assigned$ 450,000608,000176,000$1,234,000Activity LevelHandheld4012110Home5(2050Required:a. How much overhead will be assigned to each product if these three cost drivers are used to allocate overhead? What is the total< Prev 2 of 6Total4532160.Next >

Activity-based costing is a costing approach in which a company's activities are identified and the…

Maglie Company manufactures two video game consoles: handheld and home. The handheld consoles are smaller and less expensive than the home consoles. The company only recently began producing the home model. Since the introduction of the new product, profits have been steadily declining Management believes that the accounting system is not accurately allocating costs to products, particularly because sales of the new product have been increasing. Management has asked you to investigate the cost allocation problem. You find that manufacturing overhead is currently assigned to products based on their direct labor costs. For your investigation, you have data from last year. Manufacturing overhead was $1.234,000 based on production of 300,000 handheld consoles and 109,000 home consoles Direct labor and direct materials costs were as follows. Direct labor Materials Handheld $1,149,500 790,000 Home $393,000 Total $1,542,500 676,000 1,466,000 Management has determined that overhead costs are caused by three cost drivers. These drivers and their costs for last year are as follows. Cost Driver Number of production runs Quality tests performed Shipping orders processed Total overhead Costs Assigned $ 450,000 600,000 176,000 $1,234,000 Activity Level Handheld 40 12 110 Home < Prev 5 2 of 20 50 Required: a. How much overhead will be assigned to each product if these three cost drivers are used to allocate overhead? What is the total Total 45 32 160. Next >

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q