3 Exercise 17-19 (Algo) Activity-based costing to compute activity rates, overhead cost per unit, andproduct cost per unit LO P3Northwest Company produces two types of glass shelving: rounded edge and squared edge. The company reports the following costdata.Direct materialsDirect laborOverhead (using plantwide rate)Total product costUnits producedProduct cost per unitActivityPurchasingDepreciation of machinerySetupTotalNorthwest's controller wants to apply activity-based costing to allocate the $133,600 of overhead cost to the two products to seewhether product cost per unit would change markedly from that above. The company's budgeted activity usage equals its actualactivity usage for the period. The following additional information is collected.Rounded Edge Squared Edge$ 39,600$ 51,60034,40087,400$ 173,40017,200$ 10.0813, 20046, 200Required 1 Required 2 Required 3$ 99,00013,200$ 7.50ActivityBudgeted Cost$ 7,00069,40057,200$ 133,600PurchasingDepreciationSetupTotal$ 91,20047,600133,600$ 272,400Required:1. Compute the activity rate for each activity using activity-based costing.2. Compute overhead cost per unit for each of the two products using activity-based costing.3. Determine product cost per unit for each of the two products using activity-based costing.Complete this question by entering your answers in the tabs below.Activity Cost DriverPurchase ordersMachine hoursSetupsCompute the activity rate for each activity using activity-based costing. (Round "Activity rate" to 2 decimal places.)Budgeted Cost Budgeted Activity UsageActivity Ratemachine hourspurchase orderssetupsRounded Edge189 orders500 hours40 setupsRequired 2 >Activity UsageSquared Edge511 orders1,500 hours210 setupsTotal700 orders2,000 hours250 setups

Activity-based costing refers to the type of costing method under which the company allocates the…

Exercise 17-19 (Algo) Activity-based costing to compute activity rates, overhead cost per unit, and product cost per unit LO P3 Northwest Company produces two types of glass shelving: rounded edge and squared edge. The company reports the following cost data. Direct materials. Direct labor Overhead (using plantwide rate) Total product cost Units produced Product cost per unit Activity Purchasing Depreciation of machinery Setup Total Northwest's controller wants to apply activity-based costing to allocate the $133,600 of overhead cost to the two products to see whether product cost per unit would change markedly from that above. The company's budgeted activity usage equals its actual activity usage for the period. The following additional information is collected. Required 1 Rounded Edge Squared Edge $ 39,600 $ 51,600 13,200 46, 200 $ 99,000 13,200 $ 7.50 Activity Budgeted Cost $ 7,000 69,400 57,200 $ 133,600 Purchasing Depreciation Setup 34,400 87,400 $ 173,400 17,200 $ 10.08 Required 2 Required 3 Required: 1. Compute the activity rate for each activity using activity-based costing. 2. Compute overhead cost per unit for each of the two products using activity-based costing. 3. Determine product cost per unit for each of the two products using activity-based costing. Complete this question by entering your answers in the tabs below. Total $91,200 47,600 133,600 $ 272,400 Activity Cost Driver Purchase orders. Machine hours Setups Compute the activity rate for each activity using activity-based costing. (Round "Activity rate" to 2 decimal places.) Budgeted Cost Budgeted Activity Usage Activity Rate machine hours purchase orders setups Rounded Edge 189 orders 500 hours 40 setups Required 2 > Activity Usage Squared Edge 511 orders 1,500 hours 210 setups Total 700 orders 2,000 hours 250 setups

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 5CE: Roberts Company produces two weed eaters: basic and advanced. The company has four activities:...