Direct materials cost $ 81.00 Cirect labor cost 21.00 Activity-based costs allocated Total manufacturing product cost The activitics required to build the component follow: Activity Allocation Base Cost Alocated to Each Unit Start station Number of raw component chassis $ 1.50 $ 4.50 Dip insertion Number of dip insertions 0.50 14.50 Manual insertion Number of manual insertions 13 0.40 Wave solder Number of components soldered 1.50 4.50 Backload Number of backload insertions 2.80 7. Test Number of testing hours 0.39 60.00 Defect analysis Number of defect analysis hours 0.10 4.00 Total activity-based costs
Direct materials cost $ 81.00 Cirect labor cost 21.00 Activity-based costs allocated Total manufacturing product cost The activitics required to build the component follow: Activity Allocation Base Cost Alocated to Each Unit Start station Number of raw component chassis $ 1.50 $ 4.50 Dip insertion Number of dip insertions 0.50 14.50 Manual insertion Number of manual insertions 13 0.40 Wave solder Number of components soldered 1.50 4.50 Backload Number of backload insertions 2.80 7. Test Number of testing hours 0.39 60.00 Defect analysis Number of defect analysis hours 0.10 4.00 Total activity-based costs
Chapter5: Process Costing
Section: Chapter Questions
Problem 15MC: Which of the following is the step in which materials, labor, and overhead are detailed? A....
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Question
Computing product costs in an ABC system
The Alexander Manufacturing Company in Rochester, Minnesota, assembles and tests electronic components used in smartphones. Consider the following data regarding component T24 (amounts are per unit):
Requirements
- Complete the missing items for the two tables.
- Why might managers favor this ABC system instead of Alexander-’s older system, which allocated all
manufacturing overhead costs on the basis of direct labor hours?
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