Direct materials per unitDirect labor cost per unitDirect labor-hours per unitEstimated annual production and salesEstimated total manufacturing overheadEstimated total direct labor-hours$ 64.20$ 17.60Activity Cost Pools and (Activity Measures)Supporting direct labor (direct labor-hours)1.4 DLHS19,000 unitsThe company has a conventional costing system in which manufacturing overhead is applied to units based on direct labor-hours.Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below:Batch setups (setups)Product sustaining (number of products)General factory (machine-hours)Total manufacturing overhead cost$50.40$ 12.401 DLHs69,000 units$1,854,64095,600 DLHsRequired:1-a. Compute the predetermined overhead rate based on direct labor-hours.1-b. Using the predetermined overhead rate and other data from the problem, determine the unit product cost of each product.2. The company is considering replacing its conventional costing system with an activity-based costing system that would assign itsmanufacturing overhead to the following four activity cost pools:EstimatedOverhead Cost$ 664,420476,000653,06061, 160$ 1,854,640XactiveExpected Activity26,60022011,900Pathbreaker69,00012016,900Total95,60034028,800Determine the activity rate for each of the four activity cost pools.3. Using the activity rates and other data from the problem, determine the unit product cost of each product.

1-(a) Calculation of the predetermined overhead rate based on direct labor-hours.Particulars…

Answered: Requir 1-a. Compute the predetermined…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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Hi-Tek Manufacturing, Incorporated, makes two industrial component parts-B300 and T500. An absorption costing income statement for the most recent period is shown below: Hi-Tek Manufacturing, Incorporated Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss Hi-Tek produced and sold 60,400 units of B300 at a price of $21 per unit and 12,800 units of T500 at a price of $39 per unit. The company's traditional cost system allocates manufacturing overhead to products using a plantwide overhead rate and direct labor dollars as the allocation base. Additional information relating to the company's two product lines is shown below: Direct materials Direct labor Manufacturing overhead Cost of goods sold $ 1,767,600 1,212,922 554,678 610,000 $ (55,322) 8300 T500 $ 400,300 $ 162,400 $ 120,100. $ 42,400 Activity Cost Pool (and Activity Measure) Machining (machine-hours) Setups (setup hours) Product-sustaining (number of products) Other…
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Single Plantwide and Multiple Production Department Factory Overhead Rate Methods and Product Cost Distortion The management of Nova Industries Inc. manufactures gasoline and diesel engines through two production departments, Fabrication and Assembly. Management needs accurate product cost information in order to guide product strategy. Presently, the company uses a single plantwide factory overhead rate for allocating factory overhead to the two products. However, management is considering the multiple production department factory overhead rate method. The following factory overhead was budgeted for Nova: $765,000 315,000 $1,080,000 Fabrication Department factory overhead Assembly Department factory overhead Total Direct labor hours were estimated as follows: Fabrication Department Assembly Department Total In addition, the direct labor hours (dlh) used to produce a unit of each product in each department were determined from engineering records, as follows: Production Departments…
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Determining the basis for applying manufacturing overhead costs involves OA. primarily the accumulation of direct labor hours since virtually all overhead costs are driven by direct labor hours. B. primarily the maintaining of accurate records of production volume since virtually all overhead costs are driven by the number of units proc OC. the determination of a measure of activity that is a causal factor in the incurrence of overhead cost. OD. actual rather than budgeted levels of activity. Reset Selection
Required: Determine the unit product cost of each of the company's two products under activity-based costing system.
Please explain the statement below thoroughly with examples. (Ture or False) "In activity-based costing, the manufacturing overhead cost per unit will depend partially on the number of units in a batch."
1 For each of the following costs, identify the cost behavior as variable, mixed, or fixed: 1. Wages of assembly line workers 2. President's salary. 3. Plant utilities, 4. Sales force commissions 5. Shipping costs 6. Factory rent. 7. Research and development expenses 8. Property taxes 9. Advertising. 10. Supplies used in production
:Activity-based costing .uses cost pool that collects costs related to the same activity .a O .provides the same results as the departmental overhead costing .b O .uses departments overhead rate to assign overhead .c O .typically applies overhead costs using direct labor-hours .d O .None of the given answer .e O
Study the information provided below and calculate the following:3.1 Manufacturing costs per unit for each product using the traditional absorption costing system 3.2 Manufacturing overheads cost per unit for each product using the ABC system
The controller at Wesson Company's manufacturing plant has provided you with the following information for the first quarter's operations: Direct materials Fixed manufacturing overhead costs Sales price Variable manufacturing overhead Direct labor Fixed marketing and administrative costs Units produced and sold during the quarter Variable marketing and administrative costs Required: a. Prepare a gross margin income statement. b. Prepare a contribution margin income statement. Complete this question by entering your answers Required A Required B Prepare a contribution margin income statement. Contribution Margin Income Statement

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