ABT makes concrete blocks. Each unit (block) requires 25 pounds of raw materials costing $0.01 per pound. Therefore, each unit has budgeted direct materials cost of $0.25. The budgeted direct labor hours per unit (0.015 hour) and wage rate ($20 per direct labor hour). The budgeted variable overhead per unit ($10 x 0.015 direct labor hour) and total fixed overhead for the year ($1,600,000). There were 16,000,000 units expected to be produced during the year, and there were 100,000 units budgeted for ending finished goods inventory. The total cost of the ending inventory is

ABT makes concrete blocks. Each unit (block) requires 25 pounds of raw materials costing $0.01 per pound. Therefore, each unit has budgeted direct materials cost of $0.25. The budgeted direct labor hours per unit (0.015 hour) and wage rate ($20 per direct labor hour). The budgeted variable overhead per unit ($10 x 0.015 direct labor hour) and total fixed overhead for the year ($1,600,000). There were 16,000,000 units expected to be produced during the year, and there were 100,000 units budgeted for ending finished goods inventory. The total cost of the ending inventory is

Name: E◄ ListenABT makes concrete blocks. Each unit (block) requires 25 pou
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Description: E◄ ListenABT makes concrete blocks. Each unit (block) requires 25 pounds of raw materialscosting $0.01 per pound. Therefore, each unit has budgeted direct materials cost of$0.25. The budgeted direct labor hours per unit (0.015 hour) and wage rate ($

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter6: Activity-based, Variable, And Absorption Costing

Section: Chapter Questions

Problem 2EA: Crystal Pools estimates overhead will utilize 250,000 machine hours and cost $750,000. It takes 2...

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Crystal Pools estimates overhead will utilize 250,000 machine hours and cost $750,000. It takes 2 machine hours per unit, direct material cost of $14 per unit, and direct labor of $20 per unit. What is the cost of each unit produced?
Boarders estimates overhead will utilize 160,000 machine hours and cost $80,000. It takes 4 machine hours per unit, direct material cost of $5 per unit, and direct labor of $5 per unit. What is the cost of each unit produced?
Nashler Company has the following budgeted variable costs per unit produced: Budgeted fixed overhead costs per month include supervision of 98,000, depreciation of 76,000, and other overhead of 245,000. Required: 1. Prepare a flexible budget for all costs of production for the following levels of production: 160,000 units, 170,000 units, and 175,000 units. 2. What is the per-unit total product cost for each of the production levels from Requirement 1? (Round each unit cost to the nearest cent.) 3. What if Nashler Companys cost of maintenance rose to 0.22 per unit? How would that affect the unit product costs calculated in Requirement 2?
Business Specialty, Inc., manufactures two staplers: small and regular. The standard quantities of direct labor and direct materials per unit for the year are as follows: The standard price paid per pound of direct materials is 1.60. The standard rate for labor is 8.00. Overhead is applied on the basis of direct labor hours. A plantwide rate is used. Budgeted overhead for the year is as follows: The company expects to work 12,000 direct labor hours during the year; standard overhead rates are computed using this activity level. For every small stapler produced, the company produces two regular staplers. Actual operating data for the year are as follows: a. Units produced: small staplers, 35,000; regular staplers, 70,000. b. Direct materials purchased and used: 56,000 pounds at 1.5513,000 for the small stapler and 43,000 for the regular stapler. There were no beginning or ending direct materials inventories. c. Direct labor: 14,800 hours3,600 hours for the small stapler and 11,200 hours for the regular stapler. Total cost of direct labor: 114,700. d. Variable overhead: 607,500. e. Fixed overhead: 350,000. Required: 1. Prepare a standard cost sheet showing the unit cost for each product. 2. Compute the direct materials price and usage variances for each product. Prepare journal entries to record direct materials activity. 3. Compute the direct labor rate and efficiency variances for each product. Prepare journal entries to record direct labor activity. 4. Compute the variances for fixed and variable overhead. Prepare journal entries to record overhead activity. All variances are closed to Cost of Goods Sold. 5. Assume that you know only the total direct materials used for both products and the total direct labor hours used for both products. Can you compute the total direct materials and direct labor usage variances? Explain.
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Mike. Inc has two products A and B. The budgeted fixed manufacturing overhead is $10,000. The departmentis expected to work in full capacity. It plans to use cost-based pricing by using the absorption method. Assumethe firm can produce and sell 1,000 units Product A and 1,000 units Product B. Product A Product BDirect Materials $3 $2Direct Labor $1 $3Variable Manufacturing Overhead $2 $1Budgeted labor hours used for each unit product 1 4Budgeted machine hours used for each unit product 3 1Sale Demand 1,000 1,000 Product A…
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rch @ A product uses 6 Kilograms of raw materials and takes two direct labour hours to make. Raw materials cost $2.50 per kilogram and the direct labour is paid $4 per hour. Variable production overheads are 25% of labour costs. The budgeted fixed production costs for the year were $120,000 and budgeted direct labour hours were 20,000 hours. Fixed overheads are recovered on a direct labour hour basis. The Cost accountant would prepare a cost card to estimate the cost per unit as: F2 N O a. $35 O b. $25 C. $37 3 F3 # m E $31 F4 $ 4 Ei R LL 11 F5 % 5 C T F6 G F7 Y H DELL 8 & 7 F8 U * k 00 F9 8 F10 9 K 31°C PrtScr F11 O
A company has two products A and B. The budgeted fixed manufacturing overhead is $10,000. It is expected to work in full capacity. It plans to use cost-based pricing by using the absorption method. Assume the company can produce and sell 1,000 units Product A and 1,000 units Product B. Product A Product B Direct Labor $1 $3 Direct Materials $3 $2 Variable Manufacturing Overhead $2 $1 Budgeted labor hours used for each unit product 1 4 Budgeted machine hours used for each unit product 3 1 Sale Demand 1000units 1000units Required ROI Rate 10% 5% Required Investment $5000 $30000 Fixed Selling Expenses $2000 $4000 Unit Variable Selling Expenses $1 $2 If allocating fixed manufacturing overhead based on machine hour basis, calculate the sale price of products A and B and budgeted profit of products A and B.