ZXC company are using a single rate for its overhead application yet they want to decide to adopt the activity based costing in their manufacturing process. There are three activities done in the as stated below. The company usually based on 30,000 direct labor hours for its overhead and 50 pesos of materials per unit produced. The cost are as follows Activity centers Materials Handling Machine Setup Product Inspection Total Product ZZZ YYY QTY Produced 3,000 7,500 Cost 477,000 189,000 288,000 954,000 DLH Hours 8,500 12,000 DL Cost 144,000 279,000 Activity Drivers 60,000 times handled 9,000 setups 18,000 units Materials Handled 17,500 22,000 Required: 1. Compute the unit cost for each product using a single rate base on DL hours 2. Compute the unit cost for each product using activity-based costing Setups 2,250 3,600

ZXC company are using a single rate for its overhead application yet they want to decide to adopt the activity based costing in their manufacturing process. There are three activities done in the as stated below. The company usually based on 30,000 direct labor hours for its overhead and 50 pesos of materials per unit produced. The cost are as follows Activity centers Materials Handling Machine Setup Product Inspection Total Product ZZZ YYY QTY Produced 3,000 7,500 Cost 477,000 189,000 288,000 954,000 DLH Hours 8,500 12,000 DL Cost 144,000 279,000 Activity Drivers 60,000 times handled 9,000 setups 18,000 units Materials Handled 17,500 22,000 Required: 1. Compute the unit cost for each product using a single rate base on DL hours 2. Compute the unit cost for each product using activity-based costing Setups 2,250 3,600

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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Give the proper explanation.