FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Concept explainers

Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing …
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In compari…
Topic Video
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156.

Subject :- Accounting 

Drilling Company uses activity-based costing and provides this information: Driver Rate Manufacturing Activity Materials handling Machinery Assembly Inspection Cost Driver Number of parts Number of machine hours Number of parts Number of finished units $ 0.50 60.00 3.30 39.00 Drilling has just completed 89 units of a component for a customer. Each unit required 109 parts and 3.45 machine hours. The prime cost is $1,390 per finished unit. All other manufacturing costs are classified as manufacturing overhead. Required: 1. Compute the total manufacturing costs and the unit costs of the 89 units just completed using ABC costing. 2. In addition to the manufacturing costs, the firm has determined that the total cost of upstream activities, including research and development and product design, is $189 per unit. The total cost of downstream activities, such as distribution, marketing, and customer service, is $309 per unit. Compute the full product cost per unit, including upstream, manufacturing, and downstream activities. Also compute the relative proportion of each main cost category. Complete this question by entering your answers in the tabs below. Total manufacturing cost Manufacturing cost per unit Required 1 Required 2 Compute the total manufacturing costs and the unit costs of the 89 units just completed using ABC costing. (Round your intermediate and final answers to 2 decimal places.)
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Transcribed Image Text:Drilling Company uses activity-based costing and provides this information: Driver Rate Manufacturing Activity Materials handling Machinery Assembly Inspection Cost Driver Number of parts Number of machine hours Number of parts Number of finished units $ 0.50 60.00 3.30 39.00 Drilling has just completed 89 units of a component for a customer. Each unit required 109 parts and 3.45 machine hours. The prime cost is $1,390 per finished unit. All other manufacturing costs are classified as manufacturing overhead. Required: 1. Compute the total manufacturing costs and the unit costs of the 89 units just completed using ABC costing. 2. In addition to the manufacturing costs, the firm has determined that the total cost of upstream activities, including research and development and product design, is $189 per unit. The total cost of downstream activities, such as distribution, marketing, and customer service, is $309 per unit. Compute the full product cost per unit, including upstream, manufacturing, and downstream activities. Also compute the relative proportion of each main cost category. Complete this question by entering your answers in the tabs below. Total manufacturing cost Manufacturing cost per unit Required 1 Required 2 Compute the total manufacturing costs and the unit costs of the 89 units just completed using ABC costing. (Round your intermediate and final answers to 2 decimal places.)
Required 1 Required 2 In addition to the manufacturing costs, the firm has determined that the total cost of upstream activities, including research and development and product design, is $189 per unit. The total cost of downstream activities, such as distribution, marketing, and customer service, is $309 per unit. Compute the full product cost per unit, including upstream, manufacturing, and downstream activities. Also compute the relative proportion of each main cost category. (Round your final answers to 2 decimal places. For percentages.1234 = 12.34%.) Computation of full cost: Upstream activity costs Manufacturing costs Downstream activity costs Full product cost per unit < Required 1 96 96 96 Required 2 > Show less
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Transcribed Image Text:Required 1 Required 2 In addition to the manufacturing costs, the firm has determined that the total cost of upstream activities, including research and development and product design, is $189 per unit. The total cost of downstream activities, such as distribution, marketing, and customer service, is $309 per unit. Compute the full product cost per unit, including upstream, manufacturing, and downstream activities. Also compute the relative proportion of each main cost category. (Round your final answers to 2 decimal places. For percentages.1234 = 12.34%.) Computation of full cost: Upstream activity costs Manufacturing costs Downstream activity costs Full product cost per unit < Required 1 96 96 96 Required 2 > Show less
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