A manufacturer uses activity-based costing to assign overhead cost to products. Budgeted cost information for its activities follows. Budgeted Cost $ 135,000 Activity Cost Driver Purchase orders Budgeted Activity Usage 4,500 purchase orders 5,000 square feet 50 Setups 32,000 65,000 Activity Purchasing Factory services Square feet Setup Setups Compute an activity rate for each activity. (Round your answers to 2 decimal places.) Activity Purchasing Factory services Setup Budgeted Cost 135,000 32,000 65,000 $ $ $ Budgeted Activity Usage Activity Rate

A manufacturer uses activity-based costing to assign overhead cost to products. Budgeted cost information for its activities follows. Budgeted Cost $ 135,000 Activity Cost Driver Purchase orders Budgeted Activity Usage 4,500 purchase orders 5,000 square feet 50 Setups 32,000 65,000 Activity Purchasing Factory services Square feet Setup Setups Compute an activity rate for each activity. (Round your answers to 2 decimal places.) Activity Purchasing Factory services Setup Budgeted Cost 135,000 32,000 65,000 $ $ $ Budgeted Activity Usage Activity Rate

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Description: A manufacturer uses activity-based costing to assign overhead cost to products. Budgeted cost information for its activities follows.Budgeted Cost$ 135,000Activity Cost DriverPurchase ordersBudgeted Activity Usage4,500 purchase orders5,000 square fe

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 uses activity-based costing to determine the costs of its three products: A, B, and C. The budgeted cost and activity for each of the company's three activity cost pools are shown in the following table: Budgeted Activity Activity Cost PoolBudgeted Cost Product AProduct BProduct Activity 1 7,500 10,500 21,500 Activity 2 8,500 16,500 9,500 Activity 3 4,000 2,500 3,125 How much overhead will be assigned to Product B using activity-based costing? 85,000 60,000 112,000
Assume a company's activity-based costing system Includes three activitles with the following activity rates: Activity Cost Pool Activity Rate $ 2 per mile driven $ 50 per delivery $ 22 per phone call Travel Deliveries Customer service Two of the company's many customers Include Customer A and Customer B. These two customers consumed the company's activitles as follows: Total Expected Activity Customer A Customer B Travel (number of miles driven) 300 250 Deliveries (number of deliveries) Customer service (number of phone calls) 15 5 20 12 How much total activity cost would be assigned to Customer A from the company's three activitles? Multiple Choice $1,680 $1,980 $1,790 $1,690
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Dawson Company manufactures small table lamps and desk lamps. The following shows the activities per product and the total overhead information: Units Setups Inspections Assembly (dlh) Small table lamps 3,800 3,700 8,250 42,400 Desk lamps 7,800 7,400 13,750 42,400 ETT Activity Total Activity-Base Usage Budgeted Activity Cost Setups 11,100 $108,780 Inspections 22,000 110,000 Assembly (dlh) 74,200 363,580 The total factory overhead to be allocated to desk lamps is Oa, $488,642 Ob, $593,351 Oc. $209.418 Od. $349,030
?Refer to CASE 2 (Company B), What is the expected Product Margin of product Z if activity-based costing is used None of the amounts given .a O $101,250 b O $62,000 .c O $23,000 .d O
Assume a service company has implemented an activity-based costing system with five activities as shown below: Activity Cost Pool (Activity Measure) Total Cost Total Activity $ 400,000 $ 280,000 $ 150,000 $ 450,000 $ 300,000 Customer deliveries (Number of deliveries) Manual order processing (Number of manual orders) 8,000 deliveries 5,000 manual orders Electronic order processing (Number of electronic orders) 15,000 electronic orders Line item picking (Number of line items picked) Other organization-sustaining costs (None) 375,000 line items The company serves numerous customers, two of which include Hospital A and Hospital B. The activity demands pertaining to these two customers are as follows: Activity Activity Measure Hospital A Hospital B Number of deliveries 12 25 Number of manual orders 30 Number of electronic orders 15 Number of line items picked 130 250 How much total activity cost should be assigned to Hospital A for internal management purposes?
Data concerning three of Kilmon Corporation’s activity cost pools appear below: Activity Cost Pools Estimated Overhead Cost Expected Activity Assembling products $ 86,070 4,530 assembly hours Designing products $ 605,412 3,012 product design hours Setting up batches $ 48,140 830 batch set-ups Required: Compute the activity rates for each of the three cost pools.
Activity-Based Costing: Selling and Administrative Expenses Jungle Junior Company manufactures and sells outdoor play equipment. Jungle Junior uses activity-based costing to determine the cost of the sales order processing and the customer return activity. The sales order processing activity has an activity rate of $20 per sales order, and the customer return activity has an activity rate of $100 per return. Jungle Junior sold 2,500 swing sets, which consisted of 750 orders and 80 returns. a. Determine the total sales order processing and customer return activity cost for swing sets. $ b. Determine the per-unit sales order processing and customer return activity cost for swing sets. Round your answer to the nearest cent. per unit ********* 200
Dawson Company manufactures small table lamps and desk lamps. The following shows the activities per product and the total overhead information: Units Setups Inspections Assembly (dlh) 3,400 3,600 8,800 7,200 Small table lamps Desk lamps 8,400 14,000 43,200 43,200 Total Activity-Base Usage Budgeted Activity Cost 10,800 $109,080 22,400 114,240 75,600 340,200 Activity Setups Inspections Assembly (dlh) The total factory overhead (rounded to the nearest cent) to be allocated to each unit of small table lamps is O a. $80.47 O b. $136.80 O c. $48.28 O d. $104.61
⦁ Use ABC to compute overhead cost assigned to an order.KCC Production Corporation uses an activity-based costing system and provided the following budget data: The distribution of resource consumption across activities is as follows: During the year, KCC completed one order from a new customer for 1,000 units, and the related data are as follows: direct labor hours= 0.5 /unit direct materials= $2.00/unit direct labor= $5.00/hour machine hour =1 machine hour per unit Requirements1. Compute the activity rates for each of the activity cost pools.2. Compute the overhead cost assigned to the order from the new customer.
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Product Costing and Decision Analysis for a Service Company Pleasant Stay Medical Inc. wishes to determine its product costs. Pleasant Stay offers a variety of medical procedures (operations) that are considered its “products.” The overhead has been separated into three major activities. The annual estimated activity costs and activity bases follow: Activity Budgeted Activity Cost Activity Base Scheduling and admitting $432,000 Number of patients Housekeeping 4,212,000 Number of patient days Nursing 5,376,000 Weighted care unit Total costs $10,020,000 Total “patient days” are determined by multiplying the number of patients by the average length of stay in the hospital. A weighted care unit (wcu) is a measure of nursing effort used to care for patients. There were 192,000 weighted care units estimated for the year. In addition, Pleasant Stay estimated 6,000 patients and 27,000 patient days for the year. (The…