Qinto Company sells two types of products: basic and deluxe. The company provides technical support for its products at a budgeted overhead cost of $252,000 per year. The company allocates technical support cost based on 10,500 budgeted technical support calls per year. 1. Compute the activity rate for technical support using activity-based costing. 2. During January, Qinto received 640 calls on its deluxe model and 120 calls on its basic model. Allocate technical support costs to each model.
Variance Analysis
In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.
Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
Qinto Company sells two types of products: basic and deluxe. The company provides technical support for its products at a budgeted
1. Compute the activity rate for technical support using activity-based costing.
2. During January, Qinto received 640 calls on its deluxe model and 120 calls on its basic model. Allocate technical support costs to each model.
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
