Potterii sells its products to large box stores and recently added a retail line of products to sell directly to consumers. These estimates are to be used in determining the overhead allocation rate for ABC: Estimated Cost Pool Cost Driver Overhead Wholesale Retail Ordering Number of Orders $94,500 170,000 40,000 Machine Setups Number of Setups 92,500 210,000 160,000 Inspection Number of Inspections 55,000 40,000 15,000 What would be the predetermined rate for each cost pool? Round "Rate" answers to two decimal places. Estimated Total Cost Pool Cost Driver Overhead Activity Rate Ordering Number of Orders $94,500 per order Machine Number of Setups 92,500 $ per setup Setups Number of per Inspection 55,000 Inspections inspection

Potterii sells its products to large box stores and recently added a retail line of products to sell directly to consumers. These estimates are to be used in determining the overhead allocation rate for ABC: Estimated Cost Pool Cost Driver Overhead Wholesale Retail Ordering Number of Orders $94,500 170,000 40,000 Machine Setups Number of Setups 92,500 210,000 160,000 Inspection Number of Inspections 55,000 40,000 15,000 What would be the predetermined rate for each cost pool? Round "Rate" answers to two decimal places. Estimated Total Cost Pool Cost Driver Overhead Activity Rate Ordering Number of Orders $94,500 per order Machine Number of Setups 92,500 $ per setup Setups Number of per Inspection 55,000 Inspections inspection

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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Fountain Water Products (FWP) manufacturers water bottles. They have historically used a traditional system that allocated the manufacturing overhead costs based on machine hours. FWP is looking at switching to an ABC system in order to ensure more accurate product costing. They first want to compare the traditional and ABC costing systems to determine if it is worth the effort and costs to implement and maintain. They estimate a total overhead cost of $459,000. Under the traditional system they identified machine hours as the cost driver, and estimated a total of 51,000 machine hours. They actually incurred 48,700 machine hours in production. The total applied MOH calculated under the more precise ABC system was $320,000. The ABC costing system will cost $50,000 to implement. FWP has determined that a benefit of more accurate costing by $80,000 is worth the $50,000 implementation cost. What is the difference between the ABC costing and traditional system? Enter your number as a…
Subject: Cost AccountingPlease answer the given questions. Thank you!
Objective: Consider that you are an analyst at Regeneron Pharmaceuticals. You need to decide how to allocate administrative overhead costs to Regeneron's main commercial products (Eylea, Dupixent, Kevzara and Praluent). Determine how to appropriately allocate the costs in the table below to each of the commercial products using an allocation methodology of your choice. Department2019 Annual Operating ExpenseTime spent supporting Commercial productsCommercial$200MM100%IT$100MM25%Facilities$150MM0%Finance$25MM20%Human Resources$75MM10% Use the supporting document Net Product Sales of REGN Products to facilitate your analysis. Provide a written summary of how you allocated the overhead costs to each product in an outline of no more than one page. As a starting point, it's recommended that you revisit the material we covered in Chapter 12. Guidance on calculations:Start off with Net Product Sales of REGN Products. Your objective pertains to 2019 expenses, so you should be reviewing 2019…
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Using ABC, the total manufacturing costs for product Regular is:
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