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A local picnic table manufacturer has budgeted these overhead costs: Purchasing $63,000 Handling Materials 32,160 Machine Setups 70,500 Inspections 24,500 Utilities 28,500 They are considering adapting ABC costing and have estimated the cost drivers for each pool as shown: Cost Driver Activity Orders 700 Material Moves 1,340 Machine Setups 15,000 Number of Inspections 5,000 Square Feet 190,000 Recent success has yielded an order for 900 tables. Assume direct labor costs per hour of $15.   Activity Order, Units 900 Direct Materials 112,700 Machine Hours 15,300 Direct Labor Hours 5,400 Number of Purchase Orders 50 Number of Material Moves 750 Number of Machine Setups 90 Number of Inspections 400 Number of Square Feet Occupied 7,000 Determine how much the job would cost given the following activities: Do not round intermediate computations and round final answers to nearest whole number.

A local picnic table manufacturer has budgeted these overhead costs: Purchasing $63,000 Handling Materials 32,160 Machine Setups 70,500 Inspections 24,500 Utilities 28,500 They are considering adapting ABC costing and have estimated the cost drivers for each pool as shown: Cost Driver Activity Orders 700 Material Moves 1,340 Machine Setups 15,000 Number of Inspections 5,000 Square Feet 190,000 Recent success has yielded an order for 900 tables. Assume direct labor costs per hour of $15.   Activity Order, Units 900 Direct Materials 112,700 Machine Hours 15,300 Direct Labor Hours 5,400 Number of Purchase Orders 50 Number of Material Moves 750 Number of Machine Setups 90 Number of Inspections 400 Number of Square Feet Occupied 7,000 Determine how much the job would cost given the following activities: Do not round intermediate computations and round final answers to nearest whole number.

Principles of Accounting Volume 2
Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 4MC: Overhead costs are assigned to each product based on __________________. A. the proportion of that...
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A local picnic table manufacturer has budgeted these overhead costs:

Purchasing $63,000
Handling Materials 32,160
Machine Setups 70,500
Inspections 24,500
Utilities 28,500

They are considering adapting ABC costing and have estimated the cost drivers for each pool as shown:

Cost Driver Activity
Orders 700
Material Moves 1,340
Machine Setups 15,000
Number of Inspections 5,000
Square Feet 190,000

Recent success has yielded an order for 900 tables. Assume direct labor costs per hour of $15.

  Activity
Order, Units 900
Direct Materials 112,700
Machine Hours 15,300
Direct Labor Hours 5,400
Number of Purchase Orders 50
Number of Material Moves 750
Number of Machine Setups 90
Number of Inspections 400
Number of Square Feet Occupied 7,000

Determine how much the job would cost given the following activities: Do not round intermediate computations and round final answers to nearest whole number.

Cost Assigned Direct Materials Direct Labor Number of Material Moves Number of Machine Setups Number of Inspections Number of Square Feet Occupied Total Order Cost %24 %24
Transcribed Image Text:Cost Assigned Direct Materials Direct Labor Number of Material Moves Number of Machine Setups Number of Inspections Number of Square Feet Occupied Total Order Cost %24 %24
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