FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Deuter Int’l Business manufactures two products, Product L11 and Product L12. The company is considering adopting an activity-based costing system with the following activity pools, activity measures, and expected activity:
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Expected Activity
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Activity Cost Pools
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Estimated
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Product L11
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Product 12
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Total |
Machine setups required
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$200,000
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600
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1,400
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2,000
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Purchase orders issued
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38,382
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500
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100
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600
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Machine-hours required
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92,650
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6,800
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10,200
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17,000
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$331,032
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The amount overhead costs assigned to Product L11 would be closest to:
Question 15 options:
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- XYZ Co. currently uses traditional costing procedures, applying $800,000 of overhead to products Beta and Zeta on the basis of direct labor hours. The company is considering a shift to activity-based costing and the creation of individual cost pools that will use direct labor hours (DLH), production setups (SU), and number of parts components (PC) as cost drivers. Data on the cost pools and respective driver volumes follow. Product Pool No.1 (Driver: DLH) Pool No. 2 (Driver: SU) Pool No. 3 (Driver: PC) Beta 1,200 45 2,250 Zeta 2,800 55 750 Pool Cost $160,000 $280,000 $360,000 The overhead cost allocated to Zeta by using activity-based costing procedures would be: O a. $444,000. Ob. None of the given answers. O c. $472,000. Od. $356,000. O e. $328.000.arrow_forwarddevratarrow_forwardRequired information Lakeside Incorporated manufactures four lines of remote control boats and uses activity-based costing to calculate product cost. Activity Pools Machining Setup Quality control Cost Pool Machining Setup Quality Control Total Overhead Estimated Total Cost $ 679,400 105,950 164,900 Required: Suppose the Speedy boat requires 2,840 machine hours, 100 batches, and 300 inspections. Using the activity rates. determine the amount of overhead assigned to the Speedy product line. Note: Do not round your intermediate calculations and round your final answers to the nearest dollar amount. Allocated Overhead $ Estimated Cost Driver 0 21,500 machine hours 520 batches 970 inspectionsarrow_forward
- Mangiarrow_forwardMunoz Manufacturing produces two keyboards, one for laptop computers and the other for desktop computers. The production process is automated, and the company has found activity-based costing useful in assigning overhead costs to its products. The company has identified five major activities involved in producing the keyboards. Activity Materials receiving & handling Production setup Quality inspection Assembly Packing and shipping Allocation Base Cost of material Number of setups Number of parts Inspection time Number of orders Activity measures for the two kinds of keyboards follow: Allocation Rate 2% of material cost $112.00 per setup $7.00 per part $1.20 per minute $ 8.00 per order Laptops. Desktops Labor Cost $ 1,350 Material Cost Number of Setups 1,240 $ 6,500 7,100 31 Number of Parts 50 13 28 Inspection Time 6,800 minutes 4,600 minutes Number of Orders 62 22 Required a. Compute the cost per unit of laptop and desktop keyboards, assuming that Munoz made 200 units of each type of…arrow_forwardof 3 bok nt ant ences Required information Gable Company uses three activity pools. Each pool has a cost driver. Information for Gable Company follows: Activity Pools Machining Designing costs Setup costs Number of machine hours Number of design hours. Number of batches Total Cost of Pool $ 222,420 55,900 72,726 Product A Product B Product C Cost Driver Number of machine hours Number of design hours Number of batches Suppose that Gable Company manufactures three products, A. B, and C. Information about these products follows: Product A 24,000 Product C 9,400 2,600 60 2,400 265 Total Overhead Assigned Product B 34,000 1,500 180 Required: 1. Using activity proportions, determine the amount of overhead assigned to each product. Note: Do not round your intermediate calculations. Round your final answers to nearest whole number. Estimated Cost Driver 67,400 6,500arrow_forward
- Multiple Versus Single Overhead Rates, Activity Drivers Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity Capacity Setting up equipment $490,440 Number of setups 610 Ordering costs 313,500 Number of orders 16,500 Machine costs 917,700 Machine hours 43,700 Receiving 382,200 Receiving hours 9,800 Deoro produces two models of dishwashers with the following expected prime costs and activity demands: Model A Model B Direct materials $610,000 $766,000 Direct labor 451,000 499,000 Units completed 15,500 7,000 Direct labor hours 6,400 2,300 Number of setups 360 250 Number of orders 5,400 11,100 Machine hours 24,900 18,800 Receiving hours 2,700 7,100 The company's normal activity is 8,700 direct labor hours. Required: 1. Determine the unit cost for each model using direct labor hours to apply overhead. Round intermediate calculations and final…arrow_forwardonly typed solutionarrow_forwardPlease help mearrow_forward
- One of Waterway Company's activity cost pools is machine setups with estimated overhead of $240000. Waterway produces sparklers (360 setups) and lighters (640 setups). How much of the machine setup cost pool should be assigned to sparklers? O $120000 $153600 O $86400 $240000arrow_forwardAny help would be appreciated.arrow_forwardPlease help me with show all calculation thankuarrow_forward
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