quick accurate answer please\ The table compares the Traditional Cost System and the Activity-Based Costing (ABC) System for two products, Xtreme and Pathfinder. Here's a detailed breakdown:### Traditional Cost System**Xtreme:**- **Direct Materials:** - Amount: $2,092,800 - Percentage of Total: 39.7%- **Direct Labor:** - Amount: $512,000 - Percentage of Total: 46.0%- **Manufacturing Overhead:** - Amount: $819,200 - Percentage of Total: 57.7%- **Total Cost Assigned to Products:** $3,424,000**Pathfinder:**- **Direct Materials:** - Amount: $3,180,000 - Percentage of Total: 60.3%- **Direct Labor:** - Amount: $600,000 - Percentage of Total: 54.0%- **Manufacturing Overhead:** - Amount: $600,000 - Percentage of Total: 42.3%- **Total Cost Assigned to Products:** $4,380,000**Total Amount for both products:** $7,804,000### Activity-Based Costing System**Direct Costs:****Xtreme:**- **Direct Materials:** - Amount: $2,092,800 - Percentage of Total: 39.7%- **Direct Labor:** - Amount: $512,000 - Percentage of Total: 46.0%**Indirect Costs:**- **Supporting Direct Labor:** - Amount: $256,000 - Percentage of Total: 46.0%- **Batch Setups:** - Amount: $430,000 - Percentage of Total: 55.8%- **Product Sustaining:** - Amount: $200,000 - Percentage of Total: 50.0%- **Total Cost Assigned to Products:** $3,490,800**Pathfinder:**- **Direct Materials:** - Amount: $3,180,000 - Percentage of Total: 60.3%- **Direct Labor:** - Amount: $600,000 - Percentage of Total: 54.0%**Indirect Costs:**- **Supporting Direct Labor:** - Amount **Smoky Mountain Corporation: Product Cost Analysis**Smoky Mountain Corporation produces two types of hiking boots—Xtreme and Pathfinder. The relevant data for these product lines are as follows:**Product Information:**- **Xtreme:** - Selling price per unit: $115.00 - Direct materials per unit: $65.40 - Direct labor per unit: $16.00 - Direct labor-hours per unit: 1.6 DLHs - Estimated annual production and sales: 32,000 units- **Pathfinder:** - Selling price per unit: $85.00 - Direct materials per unit: $53.00 - Direct labor per unit: $10.00 - Direct labor-hours per unit: 1.0 DLH - Estimated annual production and sales: 60,000 unitsThe company currently employs a traditional costing system that applies manufacturing overhead to units based on direct labor-hours.**Estimated Data:**- Total manufacturing overhead: $1,779,200- Total direct labor-hours: 111,200 DLHs**Required Analysis:**1. **Traditional Costing System:** - Compute the product margins for Xtreme and Pathfinder based on the traditional costing system.2. **Activity-Based Costing System:** - The company is considering an overhaul to an activity-based costing (ABC) system. This system will allocate manufacturing overhead to four activity cost pools as follows: - Supporting direct labor (based on direct labor-hours) - Batch setups (based on setups) - Product sustaining (based on the number of products) - Other (includes organization-sustaining costs and idle capacity costs)**Activity Cost Pools:**- **Supporting Direct Labor:** - Estimated Overhead Cost: $556,000 - Expected Activity: Xtreme - 51,200 DLHs; Pathfinder - 60,000 DLHs; Total - 111,200 DLHs- **Batch Setups:** - Estimated Overhead Cost: $770,000 - Expected Activity: Xtreme - 430 setups; Pathfinder - 340 setups; Total - 770 setups- **Product Sustaining:** - Estimated Overhead Cost: $400,000 - Expected Activity: Xtreme - 1 product; Pathfinder - 1 product; Total - 2

Under activity based costing method, the cost is allocated to each activity based on its…

Smoky Mountain Corporation makes two types of hiking boots-Xtreme and Pathfinder. Data concerning these two product lines appear below: Selling price per unit Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production and sales Estimated total manufacturing overhead Estimated total direct labor-hours Xtreme $115.00 $65.40 $ 16.00 The company has a traditional costing system that applies manufacturing overhead to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Activities and (Activity Measures) Supporting direct labor (direct labor-hours) Batch setups (setups) Product sustaining (number of products) Other Total manufacturing overhead cost 1.6 DLHS 32,000 units Pathfinder $85.00 $ 53.00 $ 10.00 1.0 DLH 60,000 units Required: 1. Compute the product margins for Xtreme and Pathfinder under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and idle capacity costs): $ 1,779,200 111,200 DLHS Estimated Overhead Cost $ 556,000 770,000 400,000 53,200 $ 1,779,200 Expected Activity Xtreme Pathfinder 51,200 60,000 430 1 ΝΑ 340 1 ΝΑ Compute the product margins for Xtreme and Pathfinder under the activity-based costing system. 3. Prepare a quantitative comparison of the traditional and activity-based cost assignments. Total 111, 200 770 2 ΝΑ

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q