Mahaley, Incorporated, manufactures and sells two products: Product Q9 and Product FO. Data concerning the expected production of each product and the expected total direct labor-hours (DLHS) required to produce that output appear below: Product 09 Product FØ Total direct labor-hours Product Q9 Product FØ The direct labor rate is $21.80 per DLH. The direct materials cost per unit for each product is given below: Direct Materials Cost per Unit $174.90 $ 146.70 Machine setups Order size Activity Cost Pools Labor-related Expected Hours Per Production Unit 800 8.0 800 6.0 Direct Labor- The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Expected Activity Activity Measures DLHS setups MHS Total Direct Labor- Hours 6,400 4,800 11, 200 Estimated Overhead Cost $ 379,680 43,830 284,700 $ 708,210 Product Q9 Product FØ 6,400 4,800 300 200 3,100 2,900 Total 11,200 500 6,000 The unit product cost of Product FO under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)

FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
icon
Concept explainers
Topic Video
Question
Mahaley, Incorporated, manufactures and sells two products: Product Q9 and Product FO. Data concerning the expected production of each product and
the expected total direct labor-hours (DLHS) required to produce that output appear below:
Product Q9
Product F0
Total direct labor-hours
Product Q9
Product FØ
Direct
Materials
Cost per
Unit
$ 174.90
$ 146.70
The direct labor rate is $21.80 per DLH. The direct materials cost per unit for each product is given below:
Activity Cost Pools
Labor-related
Machine setups
Order size
Direct
Labor-
Expected Hours Per
Production
800
800
Unit
8.0
6.0
The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity:
Activity
Measures
DLHS
setups
MHS
Total
Direct
Labor-
Hours
6,400
4,800
11, 200
Estimated
Overhead
Cost
$ 379,680
43,830
284,700
$ 708,210
Expected Activity
Product Q9 Product FØ
6,400
4,800
300
200
3,100
2,900
Total
11,200
500
6,000
The unit product cost of Product FO under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)
Transcribed Image Text:Mahaley, Incorporated, manufactures and sells two products: Product Q9 and Product FO. Data concerning the expected production of each product and the expected total direct labor-hours (DLHS) required to produce that output appear below: Product Q9 Product F0 Total direct labor-hours Product Q9 Product FØ Direct Materials Cost per Unit $ 174.90 $ 146.70 The direct labor rate is $21.80 per DLH. The direct materials cost per unit for each product is given below: Activity Cost Pools Labor-related Machine setups Order size Direct Labor- Expected Hours Per Production 800 800 Unit 8.0 6.0 The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Activity Measures DLHS setups MHS Total Direct Labor- Hours 6,400 4,800 11, 200 Estimated Overhead Cost $ 379,680 43,830 284,700 $ 708,210 Expected Activity Product Q9 Product FØ 6,400 4,800 300 200 3,100 2,900 Total 11,200 500 6,000 The unit product cost of Product FO under activity-based costing is closest to: (Round your intermediate calculations to 2 decimal places.)
O
$674.82 per unit
$449.51 per unit
$720.13 per unit
$656.88 per unit
Transcribed Image Text:O $674.82 per unit $449.51 per unit $720.13 per unit $656.88 per unit
Expert Solution
trending now

Trending now

This is a popular solution!

steps

Step by step

Solved in 2 steps

Blurred answer
Knowledge Booster
Costing Systems
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education