Tent Master produces Pup tents and Pop-up tents. The company budgets $276,000 of overhead cost and 46,000 directlabor hours. Additional information follows.Per UnitSelling Price Direct MaterialsPup tentPop-up tent$ 9085$ 2429Direct Labor$ 5132ActivityBudgeted CostAssemblyElectricityMaterials purchasing$ 184,00028,00064,000Activity Cost DriverDirect labor hours (DLH)Machine hours (MH)Purchase orders (PO)BudgetedActivity Usage46,00010,000500$ 276,000cesTotalRequired:1. Compute an activity rate for each activity using activity-based costing.2. The following actual activity usage produced 10,000 Pup tents and 5,000 Pop-up tents. Allocate overhead cost to Pup tents andto Pop-up tents and compute overhead cost per unit for each product.Activity Cost DriverDirect labor hours(DLH)Machine hours (MH)Purchase orders (PO)Activity UsagePup tents32,000Pop-up tents14,0003,5002006,5003003. Compute product cost per unit for Pup tents and for Pop-up tents.4. For each product, compute the gross profit per unit (selling price per unit minus the product cost per unit).

1. Compute an activity rate for each activity using activity-based costing (ABC).The formula for…

Answered: Tent Master produces Pup tents and…

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 4EA: Cozy, Inc., manufactures small and large blankets. It estimates $350,000 in overhead during the...

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Cozy, Inc., manufactures small and large blankets. It estimates $950,000 in overhead during the manufacturing of 360,000 small blankets and 120,000 large blankets. What is the predetermined overhead rate if a small blanket takes 2 hours of direct labor and a large blanket takes 3 hours of direct labor?
Steeler Towel Company estimates its overhead to be $250,000. It expects to have 100,000 direct labor hours costing $2,500,000 in labor and utilizing 12,500 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours
Green Bay Cheese Company estimates its overhead to be $375,000. It expects to have 125,000 direct labor hours costing $1,500,000 in labor and utilizing 15,000 machine hours. Calculate the predetermined overhead rate using: A. Direct labor hours B. Direct labor dollars C. Machine hours
Customs makes two types of hats: polyester (poly) and silk. There are two cost pools: setup, with an estimated $100,000 in overhead, and inspection, with $25,000 in overhead. Poly is estimated to have 750,000 setups and 170,000 inspections, while silk has 250,000 setups and 80,000 inspections. How much overhead is applied to each product?
Five Card Draw manufactures and sells 10,000 units of Aces, which retails for $200, and 8,000 units of Kings, which retails for $170. The direct materials cost is $20 per unit of Aces and $15 per unit of Kings. The labor rate is $30 per hour, and Five Card Draw estimated 64000 direct labor hours. It takes 4 direct labor hours to manufacture Aces and 3 hours for Kings. The total estimated overhead is $128,000. Five Card Draw uses the traditional allocation method based on direct labor hours. A. How much is the gross profit per unit for Aces and Kings? B. What is the total gross profit for the year?
Colorado Slim Company uses an Activity-based Costing System and has budgeted the following overhead activities and costs for the year:ActivityBudgeted CostDriverBudgeted DriverRateSetup $ 400,000 # of setups400 setupsInspection $ 48,000 Inspect. Hours4,000 Inspection HoursGrinding $ 130,000 Machine Hours130,000 Machine HoursReceiving $ 50,000 # of Parts12,500 parts usedThe company produces two different products called Red and Blue. The following information was collected during the month of May:RedBlueNumber of units completed180800Number of setups for the month119Number of inspection hours for the month400900Number of machine hours for the month1,2004,000Number of parts used in May3101,600Required: Calculate the rates in the table above and assign the appropriate overhead cost for May to the two products in the table below.RedBlueSetup Costs _________ ____________Inspection Costs __________ ____________Grinding Costs___________ ____________Receiving Costs ___________ ___________
Pronghorn Manufacturing has five activity cost pools and two products (a budget tape vacuum and a deluxe tape vacuum). Information is presented below: Activity Cost Pools Ordering and Receiving Machine Setup Machining Assembly Inspection Budget Cost Driver $ Orders Deluxe $ Setups Machine hours Parts Inspections Overhead cost per unit Est. Overhead $143,000 per unit 309,600 1,022,000 per unit 1,622,000 313,000 Est. Use of Cost Drivers Budget 600 500 150,000 1,200,000 550 Deluxe Compute the overhead cost per unit for each product. Production is 700,000 units of Budget and 200,000 units of Deluxe. (Round per machine hour and per part values to 3 decimal places, eg. 52.711. Round overhead cost per unit to 2 decimal places, e.g. 12.25 and cost assigned to 0 decimal places, e.g. 2,500.) 400 400 100,000 800,000 450 SUPPO
Dhepa
Riverbed Manufacturing has five activity cost pools and two products (a budget tape vacuum and a deluxe tape vacuum). Information is presented below: Activity Cost Pools Ordering and Receiving Machine Setup Machining Assembly Inspection Budget $ Cost Driver Orders Setups Machine hours Deluxe $ Parts Inspections Overhead cost per unit Est. Overhead $144,000 311,400 1,023,000 1,624,000 314,000 per unit Est. Use of Cost Drivers Budget per unit 600 500 150,000 1.200,000 550 Deluxe 400 Compute the overhead cost per unit for each product. Production is 700.000 units of Budget and 200.000 units of Deluxe. (Round per machine hour and per part values to 3 decimal places, eg 52.711. Round overhead cost per unit to 2 decimal places, e.g. 12.25 and cost assigned to 0 decimal places, eg. 2,500.) 400 100,000 800,000 450
Rundle Boards produces two kinds of skateboards. Selected unit data for the two boards for the last quarter follow: Production costs Direct materials Direct labor Allocated overhead Total units produced and sold Total sales revenue Basco Boards Shimano Boards $ 25.20 $ 31.20 $ 15.60 5,200 $ 468,000 $ 38.40 $ 53.40 $ 20.40 9,200 $ 1,214,400 Rundle allocates production overhead using activity-based costing. It allocates delivery expense and sales commissions, which amount to $60,000 per quarter, to the two products equally. Required a. Compute the per-unit cost for each product. Note: Do not round intermediate calculations. Round your answers to 2 decimal places. b. Compute the profit for each product.
Healthfirst (HF) Ltd has recently started to produce a face shield and product's standard cost data are as follows: Cost per unit Direct materials Perspex (0.5 meters @ $15 per meter) $ 7.50 Direct materials Hardened Plastic (0.25 meters at $20.00 per meter) 5.00 Direct manufacturing labour (0.5 hr @ $30.00 per hr) Manufacturing overhead Total Cost 15.00 Required Should HF accept the offer. Show all computations. 30.00 $57.50 Additional information 45% of the Manufacturing overhead changes with the number of units produced. Additionally, if production of face shields is discontinued, 20% of the remaining fixed cost will be avoided. The budgeted production used to compute overheads is 10,000 units per quarter. HF has been approached by another company who is willing to supply the face shields at $50. Per unit. The space used to manufacture face shields can be used to Generate $ 120,000 in contribution margin per quarter.
Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity Capacity Setting up equipment $458,780 Number of setups 580 Ordering costs 354,900 Number of orders 16,900 Machine costs 710,600 Machine hours 41,800 Receiving 417,100 Receiving hours 9,700 Deoro produces two models of dishwashers with the following expected prime costs and activity demands: Model A Model B Direct materials $578,000 $772,000 Direct labor $470,000 $459,000 Units completed 15,500 8,500 Direct labor hours 5,300 2,100 Number of setups 370 210 Number of orders 5,000 11,900 Machine hours 24,000 17,800 Receiving hours 2,800 6,900 The company's normal activity is 7,400 direct labor hours. Required: 1. Determine the unit cost for each model using direct labor hours to apply overhead. Round intermediate calculations and final answers to nearest cent. Unit Cost Model A $fill in…

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