Sultan Company uses an activity-based costing system. At the beginning of the year, the company mad cost and activity for its five activity cost pools Activity Cost Pool Labor-related Purchase orders Parts management Board etching General factory Required: Activity Measure Direct labor-hours Number of orders Number of part types Number of boards Machine-hours Expected Overhead Cost $ 400,000 $11,150 $82,820 $ 73,000 $ 279,500 Expected Activity 40,000 DLHS 223 orders 101 part types 1,640 boards 21,500 s
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
Accounting
![Required 1 Required 2
Using the ABC data, determine the total amount of overhead cost assigned to each product.
Overhead Cost Overhead Cost Overhead Cost Overhead Cost
Assigned
Product A
Assigned
Product D
Activity Cost Pool
Labor-related (DLHS)
Purchase orders (orders)
Parts management (part types)
Board etching (boards)
General factory (MHs)
Total
Assigned
Product B
< Required 1
Assigned
Product C
R640](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F01d01b29-ede7-42ba-8dcd-8c0b18e94cc8%2Fe69f52a9-cb7c-4995-bd33-0b0195dc38c1%2Fiuid8d_processed.jpeg&w=3840&q=75)
![Sultan Company uses an activity-based costing system. At the beginning of the year, the company made the following estimates of
cost and activity for its five activity cost pools
Activity Cost Pool
Labor-related
Purchase orders
Parts management
Board etching
General factory
Activity Measure
Direct labor-hours
Number of orders
Number of part types
Number of boards
Machine-hours
Activity Cost Pool
Labor-related (DLHS)
Purchase orders (orders)
Parts management (part types)
Board etching (boards)
General factory ()
Required:
1. Compute the activity rate for each of the activity cost pools.
2. The expected activity for the year was distributed among the company's four products as follows:
Required 1 Required 2
Compute the activity rate for each of the activity cost pools.
Activity Cost Pool
Activity Rate
per DLH
Labor-related
Purchase orders
Parts management
Board etching
General factory
Expected
Overhead Cost
$ 400,000
$11,150
$82,820
$ 73,800
$ 279,500
Product A
6,700
4,300
63
39
36
37
15
30
300
760
580
3,900
8,800
2,500
Using the ABC data, determine the total amount of overhead cost assigned to each product.
Complete this question by entering your answers in the tabs below.
per order
per part type
per board
per MH
Bombine
Expected Activity
40,000 DLHS
223 orders
Expected Activity
Product B
23,300
101 part types
1,640 boards
21,500 s
Product C
Product D
5,700
85
11
0
6,300
4](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F01d01b29-ede7-42ba-8dcd-8c0b18e94cc8%2Fe69f52a9-cb7c-4995-bd33-0b0195dc38c1%2Ft5ah40b_processed.jpeg&w=3840&q=75)
![](/static/compass_v2/shared-icons/check-mark.png)
Step by step
Solved in 3 steps with 4 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![Principles of Cost Accounting](https://www.bartleby.com/isbn_cover_images/9781305087408/9781305087408_smallCoverImage.gif)
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)
![Excel Applications for Accounting Principles](https://www.bartleby.com/isbn_cover_images/9781111581565/9781111581565_smallCoverImage.gif)
![Principles of Cost Accounting](https://www.bartleby.com/isbn_cover_images/9781305087408/9781305087408_smallCoverImage.gif)
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)
![Excel Applications for Accounting Principles](https://www.bartleby.com/isbn_cover_images/9781111581565/9781111581565_smallCoverImage.gif)
![Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337912020/9781337912020_smallCoverImage.jpg)