Trombly Travel Products (TTP) manufactures and sells travel bags and accessories. TTP produces backpacks at its West Street plant. The different backpack models are identified by the primary material used: canvas, nylon, or leather. The company uses a plantwide rate based on direct labor-hours. The plantwide rate is $5.00 per labor-hour. All direct labor at TTP is paid $32 per hour. Canvas and nylon backpacks are produced in Department 1. Leather backpacks are produced in Department 2. The product costs (per backpack) follow. Direct materials Direct labor Canvas $ 27.00 70.40 Overhead Machine-hours Labor-hours Nylon $. 32.00 86.40 Leather $ 42.00 92.80 Required: a. Compute the total unit cost of each backpack model using the plantwide allocation method. b. The machines in Department 1 are older and almost fully depreciated. The equipment in Department 2 was recently updated and the process in Department 2 is more highly automated. At the request of the manager of Department 1, a cost analyst at TTP provided the following information on overhead costs, machine-hours and direct labor-hours for the two departments. Department 1. Department 2 $ 98,040 $ 69,680 16,400 20,800 22,800 11,400 Using labor-hours as the department allocation base for Department 1 and machine-hours as the department allocation base for Department 2, compute the allocation rate for each. c. Compute the unit cost of each model of backpack using the department allocation rates computed in requirement (b) (labor-hours in Department 1 and machine-hours in Department 2). Note: Do not round your intermediate calculations.
Trombly Travel Products (TTP) manufactures and sells travel bags and accessories. TTP produces backpacks at its West Street plant. The different backpack models are identified by the primary material used: canvas, nylon, or leather. The company uses a plantwide rate based on direct labor-hours. The plantwide rate is $5.00 per labor-hour. All direct labor at TTP is paid $32 per hour. Canvas and nylon backpacks are produced in Department 1. Leather backpacks are produced in Department 2. The product costs (per backpack) follow. Direct materials Direct labor Canvas $ 27.00 70.40 Overhead Machine-hours Labor-hours Nylon $. 32.00 86.40 Leather $ 42.00 92.80 Required: a. Compute the total unit cost of each backpack model using the plantwide allocation method. b. The machines in Department 1 are older and almost fully depreciated. The equipment in Department 2 was recently updated and the process in Department 2 is more highly automated. At the request of the manager of Department 1, a cost analyst at TTP provided the following information on overhead costs, machine-hours and direct labor-hours for the two departments. Department 1. Department 2 $ 98,040 $ 69,680 16,400 20,800 22,800 11,400 Using labor-hours as the department allocation base for Department 1 and machine-hours as the department allocation base for Department 2, compute the allocation rate for each. c. Compute the unit cost of each model of backpack using the department allocation rates computed in requirement (b) (labor-hours in Department 1 and machine-hours in Department 2). Note: Do not round your intermediate calculations.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
H1.
![Trombly Travel Products (TTP) manufactures and sells travel bags and accessories. TTP produces backpacks at its West Street plant.
The different backpack models are identified by the primary material used: canvas, nylon, or leather. The company uses a plantwide
rate based on direct labor-hours. The plantwide rate is $5.00 per labor-hour. All direct labor at TTP is paid $32 per hour. Canvas and
nylon backpacks are produced in Department 1. Leather backpacks are produced in Department 2. The product costs (per backpack)
follow.
Direct materials
Direct labor
Canvas
$ 27.00
20.40
Overhead
Machine-hours
Labor-hours
Nylon
$. 32.00
86.40
Leather
$ 42.00
92.80
Required:
a. Compute the total unit cost of each backpack model using the plantwide allocation method.
b. The machines in Department 1 are older and almost fully depreciated. The equipment in Department 2 was recently updated and
the process in Department 2 is more highly automated. At the request of the manager of Department 1, a cost analyst at TTP
provided the following information on overhead costs, machine-hours and direct labor-hours for the two departments.
Department 1. Department 2
$ 98,040
$ 69,680
16,400
20,800
22,800
11,400
Using labor-hours as the department allocation base for Department 1 and machine-hours as the department allocation base for
Department 2, compute the allocation rate for each.
c. Compute the unit cost of each model of backpack using the department allocation rates computed in requirement (b) (labor-hours in
Department 1 and machine-hours in Department 2).
Note: Do not round your intermediate calculations.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F02cd88c9-aedc-4f8c-8c8b-d98421c63ca8%2F5ec52cf6-cfba-43f6-b544-de5842e90cf3%2Fqv4prsx_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Trombly Travel Products (TTP) manufactures and sells travel bags and accessories. TTP produces backpacks at its West Street plant.
The different backpack models are identified by the primary material used: canvas, nylon, or leather. The company uses a plantwide
rate based on direct labor-hours. The plantwide rate is $5.00 per labor-hour. All direct labor at TTP is paid $32 per hour. Canvas and
nylon backpacks are produced in Department 1. Leather backpacks are produced in Department 2. The product costs (per backpack)
follow.
Direct materials
Direct labor
Canvas
$ 27.00
20.40
Overhead
Machine-hours
Labor-hours
Nylon
$. 32.00
86.40
Leather
$ 42.00
92.80
Required:
a. Compute the total unit cost of each backpack model using the plantwide allocation method.
b. The machines in Department 1 are older and almost fully depreciated. The equipment in Department 2 was recently updated and
the process in Department 2 is more highly automated. At the request of the manager of Department 1, a cost analyst at TTP
provided the following information on overhead costs, machine-hours and direct labor-hours for the two departments.
Department 1. Department 2
$ 98,040
$ 69,680
16,400
20,800
22,800
11,400
Using labor-hours as the department allocation base for Department 1 and machine-hours as the department allocation base for
Department 2, compute the allocation rate for each.
c. Compute the unit cost of each model of backpack using the department allocation rates computed in requirement (b) (labor-hours in
Department 1 and machine-hours in Department 2).
Note: Do not round your intermediate calculations.
![Complete this question by entering your answers in the tabs below.
Required A Required B Required C
Compute the total unit cost of each backpack model using the plantwide allocation method.
Note: Do not round your intermediate calculations. Round your answers to 2 decimal places.
Canvas
Nylon
Leather
Show Transcribed Text
Total Unit Cost
Department 1
Department 2
Complete this question by entering your answers in the tabs below.
Required A Required B Required C
Using labor-hours as the department allocation base for Department 1 and machine-hours as the department allocation base
for Department 2, compute the allocation rate for each.
Note: Round your answers to 2 decimal places.
Canvas
Nylon
Leather
<Required A
Allocation Rate
Show Transcribed Text
per labor hour
per machine hour
Total Unit
Cost
< Required A
Ć
J
Required B >
< Required B
Complete this question by entering your answers in the tabs below.
Required C >
*
c
Required A Required B Required C
Compute the unit cost of each model of backpack using the department allocation rates computed in requirement (b) (labor-
hours in Department 1 and machine-hours in Department 2).
Note: Do not round your intermediate calculations. Round your answers to 2 decimal places.
Required C
>](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F02cd88c9-aedc-4f8c-8c8b-d98421c63ca8%2F5ec52cf6-cfba-43f6-b544-de5842e90cf3%2Ffpsgfzj_processed.jpeg&w=3840&q=75)
Transcribed Image Text:Complete this question by entering your answers in the tabs below.
Required A Required B Required C
Compute the total unit cost of each backpack model using the plantwide allocation method.
Note: Do not round your intermediate calculations. Round your answers to 2 decimal places.
Canvas
Nylon
Leather
Show Transcribed Text
Total Unit Cost
Department 1
Department 2
Complete this question by entering your answers in the tabs below.
Required A Required B Required C
Using labor-hours as the department allocation base for Department 1 and machine-hours as the department allocation base
for Department 2, compute the allocation rate for each.
Note: Round your answers to 2 decimal places.
Canvas
Nylon
Leather
<Required A
Allocation Rate
Show Transcribed Text
per labor hour
per machine hour
Total Unit
Cost
< Required A
Ć
J
Required B >
< Required B
Complete this question by entering your answers in the tabs below.
Required C >
*
c
Required A Required B Required C
Compute the unit cost of each model of backpack using the department allocation rates computed in requirement (b) (labor-
hours in Department 1 and machine-hours in Department 2).
Note: Do not round your intermediate calculations. Round your answers to 2 decimal places.
Required C
>
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Step 1: Introduce to Plantwide Overhead Rate and Activity Rate
VIEWStep 2: Working for direct labor hours per unit and overhead cost per unit using Plantwide Rate
VIEWStep 3: Working for total unit cost using Plantwide Rate
VIEWStep 4: Working for department overhead rate and Overhead cost per unit
VIEWStep 5: Working for total cost per unit using department rate
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