Question 8XAE-2 company is reviewing the behavior of its various activities. XAD is considering various costs. The company manufactures twomodels of computers. The laptop computer (model MX10) is a top of the line, deluxe model. The tower computer (model DX 20) is theregular model. The following activity data is provided:Not yet answeredMarked out of- 1.00P Flag questionActivity Usage MeasuresModel MX10Model DX20TotalUnits produced annually15,00040,00055,000Prime costs$40,000$100,000$140,000Machine hours40,00060,000100,000Production runs1420Direct labor hours20,00030,00050,000The company primarily has thr.ee major activities as follows in the production process:ActivityActivity CostSetups$50,000Inspections$30,000Power$15,000Calculate the unit cost of model DX 20.O a. $4.0535°C RairO Type here to search

Answer: Activity cost per driver Activity Activity cost Driver facor Driver…

Answered: XAE-2 company is reviewing the behavior…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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A company is looking to launch a new product line, which requires new facilities to be used and at the moment has two planned products, called ‘Basic’ and ‘Super’. The cost per unit is planned as follows: Basic Super Direct materials £20 £24 Direct labour £14 £16 While using the absorption costing approach, the company uses machine hours as the basis to charge its production overheads. One unit of Basic will use 3 machine hours while one unit of Super will use 4 machine hours. The business sells these products at a price that gives a standard profit mark-up of 30% of full cost. For the coming year, the company expects to make and sell 8,000 units of Basic and 6,000 units of Super. If the company adopts the ABC approach, the details relating to the…

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