Q14. ABC Corp manufactures products X45E and K36N. The company uses a plantwideoverhead rate based on DLHS (direct labor-hours). It is considering implementingan activity-based costing (ABC) system that allocates its manufacturing overheadto four cost pools. The following additional information is available for the companyas a whole and for Products X45E and K36N.Activity Cost Pool Activity Measure Total Cost Total ActivityMachiningMachine setups$ 120,000$ 90,000Number of products $ 84,000$ 300,0006,000 MHs150 setupsMachine-hoursNumber of setups2 products10,000 DLHSProduct designOrder sizeDirect labor-hoursProductActivity Measure X45E4,000К36NMachine-hours2,000Number of setupsNumber of productsDirect labor-hours9060117,0003,000Determine the percentage of the total overhead cost that is allocated to ProductK36N using the plantwide overhead rate?

Name: Q14. ABC Corp manufactures products X45E and K36N. The company uses a
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Description: Q14. ABC Corp manufactures products X45E and K36N. The company uses a plantwideoverhead rate based on DLHS (direct labor-hours). It is considering implementingan activity-based costing (ABC) system that allocates its manufacturing overheadto four co

Total overhead costs = 120000+90000+84000+300000 = $594,000

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Q14. ABC Corp manufactures products X45E and K36N. The company uses a plantwide overhead rate based on DLHS (direct labor-hours). It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products X45E and K36N. Activity Cost Pool Activity Measure Total Cost Total Activity Machining Machine setups Product design Order size $ 120,000 $ 90,000 Number of products | $ 84,000 $ 300,000 Machine-hours 6,000 MHs Number of setups 150 setups 2 products 10,000 DLHS Direct labor-hours Product Machine-hours Number of setups Number of products Activity Measure X45E K36N 2,000 60 1 4,000 90 Direct labor-hours 7,000 3,000 Determine the percentage of the total overhead cost that is allocated to Product K36N using the plantwide overhead rate?

Q14. ABC Corp manufactures products X45E and K36N. The company uses a plantwide overhead rate based on DLHS (direct labor-hours). It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products X45E and K36N. Activity Cost Pool Activity Measure Total Cost Total Activity Machining Machine setups Product design Order size $ 120,000 $ 90,000 Number of products | $ 84,000 $ 300,000 Machine-hours 6,000 MHs Number of setups 150 setups 2 products 10,000 DLHS Direct labor-hours Product Machine-hours Number of setups Number of products Activity Measure X45E K36N 2,000 60 1 4,000 90 Direct labor-hours 7,000 3,000 Determine the percentage of the total overhead cost that is allocated to Product K36N using the plantwide overhead rate?

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 4CE: Larsen, Inc., produces two types of electronic parts and has provided the following data: There are...

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