FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Helton Fumiture Corporation has identified activity centers to which overhead costs
are assigned. The cost pool amounts for these centers and their sekcted activity
drivers for 2012 are as follows.
Activity
Centers Costs
Activity Drivers
Urilities
$300,000
60,000 machine hours
Scheduling and setup
273,000
780 setups
Material handling
640,000
1,600,000 pounds of material
The company's products and other opertating slatisties follow
Products
Dieet costs
S80,000
$80,00
$90,000
Machine bours
30,000
10,000
20,000
Number of setups
130
380
270
Pounds of material
500,000
300,000
800,000
Number of units produced
40,000
20,000
60,000
Direct labor hours
32.000
18,000
50,000
Required:
2. Determine unit product cost using the apyropriate cost drivers( ABC) fet cach of
the products.
b. Before it installed an ABC system, the company used a conventiona!
costing(Simple) system and allocated factory overhesd to products using đirect labor
tours. Determine unit costs for each of the products.
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Transcribed Image Text:Helton Fumiture Corporation has identified activity centers to which overhead costs are assigned. The cost pool amounts for these centers and their sekcted activity drivers for 2012 are as follows. Activity Centers Costs Activity Drivers Urilities $300,000 60,000 machine hours Scheduling and setup 273,000 780 setups Material handling 640,000 1,600,000 pounds of material The company's products and other opertating slatisties follow Products Dieet costs S80,000 $80,00 $90,000 Machine bours 30,000 10,000 20,000 Number of setups 130 380 270 Pounds of material 500,000 300,000 800,000 Number of units produced 40,000 20,000 60,000 Direct labor hours 32.000 18,000 50,000 Required: 2. Determine unit product cost using the apyropriate cost drivers( ABC) fet cach of the products. b. Before it installed an ABC system, the company used a conventiona! costing(Simple) system and allocated factory overhesd to products using đirect labor tours. Determine unit costs for each of the products.
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