Paper No. 2PART 1: A-COMPLETING THE FOLLOWING TABLES (Notes: You are required to show all relevent computations on the other side of this paper.)DovaleGajesticRateCost Assigned Total OverheadOverhead RatePurchase ordersMachine setupsMachine hoursInspectionsTotal assigned costsUnits producedCost per unitDirect materialsDirect laborManufacturing overheadTotal cost per unitSales price per unitCost per unitGross profitDrivers UsedCost AssignedDrivers Used PART 1: COMPLETING MISSING INFORMATIONBONZZE Electronics manufactures two large-screen television models: the Foyale which sells for $1,800, and a new model,the Lajestic, which sells for $1,350. The production cost computed per unit under traditional costing for each model in 2021was as follows.Traditional CostingFoyaleLajesticDirect materialsDirect labor ($20 per hour)Mfg overhead ($38 per DLH)Total per unit cost$1,200In 2021, BONZZEmanufactured 26,000 units of the Foyale and 10,000 units of the Lajestic. The overhead rate of $38 perdirect labor hour was determined by dividing total expected manufacturing overhead of $7,500,000 by the total direct laborhours (200,000) for the two models.Under traditional costing, the gross profit on the models was Foyale $600 or ($1,800 - $1,200), and Lajestic $570 or ($1,350 -$780). Because of this difference, management is considering phasing out the Foyale model and increasing the produc- tion ofthe Lajestic model.Cost DriverNumber of ordersNumber of setupsMachine hoursBefore finalizing its decision, management asks BONZZE's controller to prepare an analysis using activity-based costing(ABC). The controller accumulates the following information about overhead for the year ended December 31, 2021.Expected Use ofActivityPurchasingMachine setupsMachiningQuality control Number of inspections$800150250The cost drivers used for each product were:Cost DriverPurchase ordersMachine setupsMachine hoursInspectionsFoyale17,0005,00075,00011,000$450120210$780EstimatedOverhead$1,280,000918,0004,800,000700,000Lajestic23,00013,00045,00017,000CostDrivers40,00018,000120,00028,000Total40,00018,000120,00028,000Required:A. Assign the total 2021 manufacturing overhead costs to the two products using activity-based costing (ABC). What was thecost per unit and gross profit of each model using ABC costing?B. Are management's future plans for the two models sound? Why?

ABC costing: It is a modern costing method that identifies the activity and assigns the cost of each…

Paper No. 2 PART 1: A-COMPLETING THE FOLLOWING TABLES (Notes: You are required to show all relevent computations on the other side of this paper.) Doyale Gajestic Overhead Rate Rate Cost Assigned Drivers Used Cost Assigned Purchase orders Machine setups Machine hours Inspections Total assigned costs Units produced Cost per unit Direct materials Direct labor Manufacturing overhead Total cost per unit Sales price per unit Drivers Used Total Overhe

Paper No. 2 PART 1: A-COMPLETING THE FOLLOWING TABLES (Notes: You are required to show all relevent computations on the other side of this paper.) Doyale Gajestic Overhead Rate Rate Cost Assigned Drivers Used Cost Assigned Purchase orders Machine setups Machine hours Inspections Total assigned costs Units produced Cost per unit Direct materials Direct labor Manufacturing overhead Total cost per unit Sales price per unit Drivers Used Total Overhe

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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Primare Corporation provided the following data for last month's manufacturing operations. Purchases of raw materials Indirect materials used in production Direct labor $ 30,000 $4,930 $ 60,000 $7,500 $ 4,130 Manufacturing overhead applied to work in process Underapplied overhead Rav materials Work in process Finished goods Beginning $ 11,900 $ 54,100 $34,900 Required: 1 Prepare a schedule of cost of goods manufactured. 2. Prepare a schedule of cost of goods sold. Assume the underapplied or overapplied overhead is closed to Cost of Goods Sold. Complete this question by entering your answers in the tabs below. Direct materials Required 1 Required 2 Prepare a schedule of cost of goods manufactured. Inding $19,500 $ 67,000 $ 43,200 Total raw materials available Pamare Corporation Schedule of Cost of Goods Manufactured Raw materials used in production Direct materials used in production
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