### Required InformationHeidelberg Fabrication manufactures two products, G-09 and G-35:#### Production Data- **G-09:** - Units produced: 19,900 - Direct materials cost per unit: $7 - Machine-hours per unit: 4 - Production runs per quarter: 144- **G-35:** - Units produced: 3,980 - Direct materials cost per unit: $19 - Machine-hours per unit: 7 - Production runs per quarter: 72#### Manufacturing OverheadProduction at the plant is automated and any labor cost is included in overhead. Data on manufacturing overhead at the plant include:- Machine depreciation: $107,460- Setup labor: $53,730- Materials handling: $42,984- **Total Overhead: $204,174**### Requireda. Heidelberg currently applies overhead on the basis of machine-hours. What is the predetermined overhead rate for the quarter? **Note:** Round your answer to 2 decimal places.b. Heidelberg is thinking of adopting an Activity-Based Costing (ABC) system. They have tentatively chosen the following cost drivers: - Machine-hours for machine depreciation, - Production runs for setup labor, - Direct material dollars for materials handling.Compute the cost driver rates for the proposed system at Heidelberg.### Placeholder for Cost Driver Calculations- **a. Overhead Rate:** _____ per machine hour- **b. Machine Depreciation:** _____ per machine hour- **b. Setup Labor:** _____ per production run- **b. Materials Handling:** _____ % of direct material costThis setup illustrates the manufacturing costs and overhead allocations at Heidelberg Fabrication, providing a foundation for exploring cost accounting methods such as Activity-Based Costing (ABC).

Name: ### Required InformationHeidelberg Fabrication manufactures two produ
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Description: ### Required InformationHeidelberg Fabrication manufactures two products, G-09 and G-35:#### Production Data- **G-09:** - Units produced: 19,900 - Direct materials cost per unit: $7 - Machine-hours per unit: 4 - Production runs per quarter: 144-

By obtaining a more exact knowledge of how costs are incurred and dispersed, organizations may utilize ABC costing to make more educated decisions regarding pricing, cost control, process optimization, and resource allocation. By helping businesses determine the real cost of their goods and services, ABC enhances profitability analysis and cost management.Computation of estimated machine hoursEstimated`machine hours = (19,900x4)+(3,980x7) = 79,600 + 27,860 = 107,460Computation of predetermined overhead ratePre-determined overhead rate = 204,174 / 107,460 = 1.90Estimated material cost = (19,900x7)+(3,980x19) = 139,300 + 75,620 = 214,920Computation of machine depreciationMachine depreciation = 107,460 / 107,460 = $1Computation of set% Final Answer Overhead rate $1.90per machine hourMachine depreciation $1per machine hourSetup labor $249per production runMaterial handling 20% direct material cost

Business

Accounting

Required information Heidelberg Fabrication manufactures two products, G-09 and G-35: Units produced Direct materials cost per unit Machine-hours per unit Production runs per quarter Machine depreciation Setup labor Materials handling Total Required: Production at the plant is automated and any labor cost is included in overhead. Data on manufacturing overhead at the plant follow: G-09 19,900 a. Overhead rate b. Machine depreciation $7 4 144 b. Setup labor b. Materials handling G-35 3,980 $19 $ 107,460 53,730 42,984 $ 204,174 a. Heidelberg currently applies overhead on the basis of machine-hours. What is the predetermined overhead rate for the qua Note: Round your answer to 2 decimal places. b. Heidelberg is thinking of adopting an ABC system. They have tentatively chosen the following cost drivers: machine-hours f machine depreciation, production runs for setup labor, and direct material dollars for materials handling. Compute the cost rates for the proposed system at Heidelberg. 7 72 per machine hour per machine hour per production run % direct material cost

Required information Heidelberg Fabrication manufactures two products, G-09 and G-35: Units produced Direct materials cost per unit Machine-hours per unit Production runs per quarter Machine depreciation Setup labor Materials handling Total Required: Production at the plant is automated and any labor cost is included in overhead. Data on manufacturing overhead at the plant follow: G-09 19,900 a. Overhead rate b. Machine depreciation $7 4 144 b. Setup labor b. Materials handling G-35 3,980 $19 $ 107,460 53,730 42,984 $ 204,174 a. Heidelberg currently applies overhead on the basis of machine-hours. What is the predetermined overhead rate for the qua Note: Round your answer to 2 decimal places. b. Heidelberg is thinking of adopting an ABC system. They have tentatively chosen the following cost drivers: machine-hours f machine depreciation, production runs for setup labor, and direct material dollars for materials handling. Compute the cost rates for the proposed system at Heidelberg. 7 72 per machine hour per machine hour per production run % direct material cost

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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