William Financial Resources (WFR) manufacturers finance textbooks that explains finance concepts in layman terms for the average American. They have historically used a traditional system that allocated the manufacturing overhead costs based on machine hours. WFR is looking at switching to an ABC system in order to ensure accurate product costing. They first want to compare the traditional and ABC costing systems to determine if it is worth the effort and costs to implement and maintain. They estimate a total overhead cost of $459,000. Under the traditional system they identified machine hours as the cost driver, and estimated a total of 51,000 machine hours. They actually incurred 48,700 machine hours in production. The total applied MOH calculated under the more precise ABC system was $320,000. What is the difference in applied MOH between the traditional and ABC costing systems? Please provide your answer as an absolute (positive), to the nearest dollar, and do not include the "$" symbol.
William Financial Resources (WFR) manufacturers finance textbooks that explains finance concepts in layman terms for the average American. They have historically used a traditional system that allocated the
They estimate a total overhead cost of $459,000. Under the traditional system they identified machine hours as the cost driver, and estimated a total of 51,000 machine hours. They actually incurred 48,700 machine hours in production. The total applied MOH calculated under the more precise ABC system was $320,000. What is the difference in applied MOH between the traditional and ABC costing systems? Please provide your answer as an absolute (positive), to the nearest dollar, and do not include the "$" symbol.
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