Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and lines appear below: Selling price per unit Xtreme $ 126.00 Pathfinder $ 91.00 Direct materials per unit $ 63.20 $ 51.00 Direct labor per unit $ 11.70 $ 9.00 Direct labor-hours per unit Estimated annual production and sales 1.3 DLHS 21,000 units 1.0 DLHS 75,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $ 2,250,600 102,300 DLHS Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and id

Smoky Mountain Corporation makes two types of hiking boots-the Xtreme and lines appear below: Selling price per unit Xtreme $ 126.00 Pathfinder $ 91.00 Direct materials per unit $ 63.20 $ 51.00 Direct labor per unit $ 11.70 $ 9.00 Direct labor-hours per unit Estimated annual production and sales 1.3 DLHS 21,000 units 1.0 DLHS 75,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $ 2,250,600 102,300 DLHS Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system that would assign its manufacturing overhead to the following four activity cost pools (the Other cost pool includes organization-sustaining costs and id

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter11: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 17E: Product cost method of product costing Smart Stream Inc. uses the product cost method of applying...

See similar textbooks

Similar questions

Smoky Mountain Corporation makes two types of hiking boots the Xtreme and the Pathfinder. Data concerning these two product ines appear below: Selling price per unit Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production and sales Xtreme $ 120.00 $ 65.20 11.201 1.4 D 10,000 units Pathfinder $87.00 5 51.00 $8.00 1.0 65,000 unit The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead Estimated total direct labor-hours $ 2,033,000 107,000 D Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity based costing system that would assign its manufacturing overhead to the following…
Smoky Mountain Corporation makes two types of hiking boots—the Xtreme and the Pathfinder. Data concerning these two product lines appear below: Xtreme Pathfinder Selling price per unit $ 121.00 $ 85.00 Direct materials per unit $ 64.90 $ 51.00 Direct labor per unit $ 11.20 $ 8.00 Direct labor-hours per unit 1.4 DLHs 1.0 DLHs Estimated annual production and sales 27,000 units 70,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead $ 2,156,000 Estimated total direct labor-hours 107,800 DLHs Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company’s traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing…
Smoky Mountain Corporation makes two types of hiking boots—the Xtreme and the Pathfinder. Data concerning these two product lines appear below: Xtreme Pathfinder Selling price per unit $ 132.00 $ 94.00 Direct materials per unit $ 64.60 $ 53.00 Direct labor per unit $ 9.60 $ 8.00 Direct labor-hours per unit 1.2 DLHs 1.0 DLHs Estimated annual production and sales 24,000 units 70,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead $ 2,470,000 Estimated total direct labor-hours 98,800 DLHs Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company’s traditional costing system. 2. The company is considering replacing its traditional costing system with an…
Smoky Mountain Corporation makes two types of hiking boots—the Xtreme and the Pathfinder. Data concerning these two product lines appear below: Xtreme Pathfinder Selling price per unit $ 120.00 $ 87.00 Direct materials per unit $ 63.60 $ 55.00 Direct labor per unit $ 12.00 $ 10.00 Direct labor-hours per unit 1.2 DLHs 1.0 DLHs Estimated annual production and sales 25,000 units 72,000 units The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Estimated total manufacturing overhead $ 2,040,000 Estimated total direct labor-hours 102,000 DLHs Required: 1. Compute the product margins for the Xtreme and the Pathfinder products under the company’s traditional costing system. 2. The company is considering replacing its traditional costing system with…
Smoky Mountain Corporation makes two types of hiking boots-Xtreme and Pathfinder. Data concerning these two product lines appear below: Selling price per unit Direct materials per unit. Direct labor per unit Direct labor-hours per unit Estimated annual production and sales Estimated total manufacturing overhead Estimated total direct labor-hours Xtreme $ 120.00 $65.20 $11.20 Activities and (Activity Measures) Supporting direct labor (direct labor-hours) 1.4 DLHS 30,000 units The company has a traditional costing system that applies manufacturing overhead to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: Pathfinder $ 87.00 $ 51.00 $8.00 1.0 DLH 65,000 units $ 2,033,000 107.000 DLHS Required: 1. Compute the product margins for Xtreme and Pathfinder under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based costing system…
Racer X Corporation manufactures two models of motorized go-carts, a standard and a deluxe model. The following activity and cost information has been compiled: Direct Labor-Hours per unit Annual Production Deluxe 0.4 20,000 units Standard 0.2 80,000 units Additional information follows: a. Deluxe models require $17 in DM per unit and Standard models require $10. b. The DL wage rate is $16 per hour. c. Deluxe models are more complex to manufacture than Standard models, and they require special equipment. d. The ABC system has the following activity cost pools: Activity Cost pool Activity Measure Estimated Activity Overhead Deluxe Standard Total Cost Machine setups Special processing General factory Number of setups $21,600 $180,000 $288,000 100 80 180 Machine-hours 4,000 4,000 DL-hrs 8,000 16,000 24,000 Required: 1- Compute the activity rate for each activity cost pool 2- Compute the unit cost of each product according to the ABC system
Stillicum Corporation makes ultra light-weight backpacking tents. Data concerning the company's two product lines appear below: Direct materials per unit Direct labor per unit Direct labor-hours per unit Estimated annual production Estimated total manufacturing overhead Estimated total direct labor-hours Deluxe $ 67.00 $ 25.00 Activity Cost Pools (and Activity Measures) Supporting direct labor (direct labor-hours) 0.70 DLHS 10,000 units Standard $ 55.00 $ 20.40 The company has a traditional costing system in which manufacturing overhead is applied to units based on direct labor-hours. Data concerning manufacturing overhead and direct labor-hours for the upcoming year appear below: 1.40 DLHS 50,000 units $ 505,000 77,000 DLHS Required: 1. Determine the unit product costs of the Deluxe and Standard products under the company's traditional costing system. 2. The company is considering replacing its traditional costing system with an activity-based absorption costing system that would have…
Corvine Corporation makes two types of motors for use in various products. Operating data and unit cost information for its products are presented next. Product A Producet B Annual unit capacity 10,000 20,000 Annual unit demand 10,000 20.000 Selling price Variable manufacturing cost Fixed manufacturing cost Variable selling and administrative 10 Fixed selling and administrative 5 Fixed other administrative S100 $80 53 45 10 10 11 Unit operating profit $20 $10 Machine hours per unit 2.0 1.5 Corvine has 40,000 productive hours available. Required Calculate the relevant contribution margin, per machine hour for each product, to be utilized in making a decision on product priorities for the coming year.
Mahaley, Incorporated, manufactures and sells two products: Product Q9 and Product FO. Data concerning the expected production of each product and the expected total direct labor-hours (DLHs) required to produce that output appear below: Product 09 Product Fe Total direct labor-hours Product Q9 Product Fe The direct labor rate is $22.50 per DLH. The direct materials cost per unit for each product is given below: Direct Materials Cost per Unit $ 175.60 $ 147.40 Activity Cost Pools Labor-related Expected Production 870 870 Machine setups Order size The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Overhead Cost Direct Labor- Hours Per Unit 8.7 6.7 Activity Measures DLHS setups MHS Total Direct Labor- Hours 7,569 5,829 13,398 $ 386,680 47,330 288, 200 $ 722,210 Expected Activity Product Q9 Product Fe 7,569 5,829 650 550 3,800 3,600 Total 13,398 1,200 7,400 The unit product cost…
Winter Grow Inc. manufactures a range of heat mats. The production information for its standard heat mat is follows: Production Information for Standard Heat Mat Production Information Amount Monthly production capacity Current level of production $23 per Normal selling price per unit unit Variable manufacturing costs $5 per unit Variable selling and administrative $2 per unit expenses Fixed manufacturing costs (allocated) $4 per unit Fixed selling and administrative $2 per unit expenses (allocated) $75,000 profit $35,000 profit 25,000 units During current month, the company received an offer to sell 5,000 lights to an exporter for $13 per unit. The variable selling and administrative expenses per unit will be reduced by $1 as this is a one-off offer and some of the selling expenses would not be payable on this offer. Acceptance of this order does not affect the pricing policy in the domestic market. How much would be the profit or loss from the acceptance of this offer? $35,000 loss…
SIMPly Power Inc., manufactures and sells two products: Product V9 and Product B1. Data concerning the expected production of each product and the expected total direct labour-hours (DLHs) required to produce that output is shown below: Expected Production Direct Labour-Hours Per Unit Total Direct Labour-Hours Product V9 300 5.0 1,500 Product B1 800 3.0 2,400 Total direct labour-hours 3,900 The direct labour rate is $27.40 per DLH. The direct materials cost per unit for each product is given below: Direct Materials Cost per Unit Product V9 $176.90 Product B1 $262.80 The company is considering adopting an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Estimated Expected Activity Activity Cost Pools Activity Measures Overhead Cost Product V9 Product B1 Total Labour-related DLHs $94,848 1,500 2,400 3,900 Machine setups…
Skull Company makes snowboards and uses the total cost method in setting product price. Its costs for producing 18,500 units follow. The company targets a 12.0% markup on total cost. Variable Costs per Unit Direct materials Direct labor Overhead Selling, general and administrative Fixed Costs (total) Overhead Selling, general and administrative $117 42 37 6 1. Total cost per unit 2. Markup per unit 3. Selling price per unit $ 463,000 425,000 1. Compute the total cost per unit if 18,500 units are produced. 2. Compute the dollar markup per unit. 3. Compute the selling price per unit. (For all requirements, round your final answers to the nearest dollar amounts.)