pproximately Relevant ABC Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost           Activity Driver Activity Capacity Setting up equipment $147,000           Number of setups   120   Ordering materials 18,000           Number of orders   1,200   Machining 126,000           Machine hours   10,500   Receiving 30,240           Receiving hours   1,260   Silven produces two models of cell phones with the following expected activity demands:         Model X       Model Y Units completed   5,400     10,800 Number of setups   80     40 Number of orders   400     800 Machine hours   6,000     4,500 Receiving hours   420     840 Required: 1. Determine the total overhead assigned to each product using the four activity drivers.   Total Overhead Assigned     Model Y   2. Determine the total overhead assigned to each model using the two most expensive activities. The costs of the two relatively inexpensive activities are allocated to the two expensive activities in proportion to their costs. Round interim calculations to two decimal places and round your final answers to the nearest dollar.   Total Overhead Assigned Model X   Model Y   3. Using ABC as the benchmark, calculate the percentage error. Round your answers to two decimal places.   Percentage Error Model X   Model Y

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
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Chapter1: Financial Statements And Business Decisions
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pproximately Relevant ABC

Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year:

Activity Expected Cost           Activity Driver Activity Capacity
Setting up equipment $147,000           Number of setups   120  
Ordering materials 18,000           Number of orders   1,200  
Machining 126,000           Machine hours   10,500  
Receiving 30,240           Receiving hours   1,260  

Silven produces two models of cell phones with the following expected activity demands:

        Model X       Model Y
Units completed   5,400     10,800
Number of setups   80     40
Number of orders   400     800
Machine hours   6,000     4,500
Receiving hours   420     840

Required:

1. Determine the total overhead assigned to each product using the four activity drivers.

  Total Overhead Assigned
   
Model Y  

2. Determine the total overhead assigned to each model using the two most expensive activities. The costs of the two relatively inexpensive activities are allocated to the two expensive activities in proportion to their costs. Round interim calculations to two decimal places and round your final answers to the nearest dollar.

  Total Overhead Assigned
Model X  
Model Y  

3. Using ABC as the benchmark, calculate the percentage error. Round your answers to two decimal places.

  Percentage Error
Model X  
Model Y  
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