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Zwahlen Corporation has an activity-based costing system with three activity cost pools- the Processing cost pool are assigned to products based on machine-hours (MHs) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. Data concerning the two products and the company's costs and activity-based costing system appear below: Activity Cost Pools Processing Setting Up Other Product 07 Product He Total Sales (total) Direct materials (total) Direct labor (total) $ 57,800 $ 15,700 $ 29,500 MHS 9,000 13,000 22,000 Batches 700 1,300 2,000 Product D7 $ 220,300 $ 73,600 $ 106,500 Product He $ 306, 100 $ 146,200 $ 97,200 Required: . Calculate activity rates for each activity cost pool using activity-based costing. o. Determine the amount of overhead cost that would be assigned to each product using activity-based costing. Determine the product margins for each product using activity-based costing.

Zwahlen Corporation has an activity-based costing system with three activity cost pools- the Processing cost pool are assigned to products based on machine-hours (MHs) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. Data concerning the two products and the company's costs and activity-based costing system appear below: Activity Cost Pools Processing Setting Up Other Product 07 Product He Total Sales (total) Direct materials (total) Direct labor (total) $ 57,800 $ 15,700 $ 29,500 MHS 9,000 13,000 22,000 Batches 700 1,300 2,000 Product D7 $ 220,300 $ 73,600 $ 106,500 Product He $ 306, 100 $ 146,200 $ 97,200 Required: . Calculate activity rates for each activity cost pool using activity-based costing. o. Determine the amount of overhead cost that would be assigned to each product using activity-based costing. Determine the product margins for each product using activity-based costing.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Zwahlen Corporation has an activity-based costing system with three activity cost pools-Processing, Setting Up, and Other. the Processing cost pool are assigned to products based on machine-hours (MHS) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. Data concerning the two products and the company's costs and activity-based costing system appear below: Activity Cost Pools Processing Setting Up Other Product D7 Product He Total Sales (total) Direct materials (total) Direct labor (total) $ 57,800 $ 15,700 $ 29,500 MHS 9,000 13,000 22,000 Batches 700 1,300 2,000 Product D7 $ 220,300 $ 73,600 $ 106,500 Product He $ 306,100 $ 146,200 $ 97,200 Required: a. Calculate activity rates for each activity cost pool using activity-based costing. b. Determine the amount of overhead cost that would be assigned to each product using activity-based costing. c. Determine the product margins for each product using activity-based costing.
Transcribed Image Text:Zwahlen Corporation has an activity-based costing system with three activity cost pools-Processing, Setting Up, and Other. the Processing cost pool are assigned to products based on machine-hours (MHS) and costs in the Setting Up cost pool are assigned to products based on the number of batches. Costs in the Other cost pool are not assigned to products. Data concerning the two products and the company's costs and activity-based costing system appear below: Activity Cost Pools Processing Setting Up Other Product D7 Product He Total Sales (total) Direct materials (total) Direct labor (total) $ 57,800 $ 15,700 $ 29,500 MHS 9,000 13,000 22,000 Batches 700 1,300 2,000 Product D7 $ 220,300 $ 73,600 $ 106,500 Product He $ 306,100 $ 146,200 $ 97,200 Required: a. Calculate activity rates for each activity cost pool using activity-based costing. b. Determine the amount of overhead cost that would be assigned to each product using activity-based costing. c. Determine the product margins for each product using activity-based costing.
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