FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
Bartleby Related Questions Icon

Related questions

bartleby

Concept explainers

Topic Video
Question
A local picnic table manufacturer has budgeted these overhead costs - ERROR: "Handling materials" is $33,350 - (note their order as you will use
the same order down below):
Purchasing
Handling materials
Machine setups
$70,000
33,333
70,500
25,500
45,000
Inspections
Utilities
They are considering adapting ABC costing and have estimated the cost drivers for each pool as shown (again, note their order):
Cost Driver
Activity
Orders
700
Material moves
Machine setups
Number of inspections
Square feet
1,334
15,000
5,000
180,000
Recent success has yielded an order for 1,000 tables. Assume direct labor costs per hour of $20. Determine how much the job would cost given the
following activities (once more, note their order for the last worksheet):
Activity
Order (units)
Direct materials
1,000
112,700
15,200
5,300
60
Machine hours
Direct labor hours
Number of purchase orders
Number of material moves
Number of machine setups
Number of inspections
Number of square feet occupied
800
100
450
8,000
Using the following cost driver terms, complete the two worksheets below to:
Number of material
Manufacturing
Number of purchase
Direct labor
moves
overhead
orders
Number of machine
Number of inspections
Direct materials
Square feet occupied
setups
PLEASE NOTE: For activity levels, use commas as needed (i.e. 1,234). Activity rates are rounded to two decimal places and shown with "$" and
commas as needed (i.e. $1,234.56). All other dollar amounts are rounded to whole dollars and shown with "$" and commas as needed (i.e.
expand button
Transcribed Image Text:A local picnic table manufacturer has budgeted these overhead costs - ERROR: "Handling materials" is $33,350 - (note their order as you will use the same order down below): Purchasing Handling materials Machine setups $70,000 33,333 70,500 25,500 45,000 Inspections Utilities They are considering adapting ABC costing and have estimated the cost drivers for each pool as shown (again, note their order): Cost Driver Activity Orders 700 Material moves Machine setups Number of inspections Square feet 1,334 15,000 5,000 180,000 Recent success has yielded an order for 1,000 tables. Assume direct labor costs per hour of $20. Determine how much the job would cost given the following activities (once more, note their order for the last worksheet): Activity Order (units) Direct materials 1,000 112,700 15,200 5,300 60 Machine hours Direct labor hours Number of purchase orders Number of material moves Number of machine setups Number of inspections Number of square feet occupied 800 100 450 8,000 Using the following cost driver terms, complete the two worksheets below to: Number of material Manufacturing Number of purchase Direct labor moves overhead orders Number of machine Number of inspections Direct materials Square feet occupied setups PLEASE NOTE: For activity levels, use commas as needed (i.e. 1,234). Activity rates are rounded to two decimal places and shown with "$" and commas as needed (i.e. $1,234.56). All other dollar amounts are rounded to whole dollars and shown with "$" and commas as needed (i.e.
(1) calculate the overhead assigned rate (note their order from above):
Overhead Cost
Estimated
Cost Driver
Activity Levels
Activity Rate
Items
Overhead
Purchasing
$70,000
Number of purchası
700
$100
Handling
$33,350
Number of material
1,334
$25
materials
Machine setups
$70,500
Number of machine
15,000
$4.70
Inspections
$25,500
Number of inspecti
5,000
$5.10
Utilities
$45,000
Square feet occupie
180,000
$0.25
(2) calculate the total order cost (again, note their order from above):
Activity Cost Drivers
Activity Levels
Activity Rate
Assigned Costs
Total Order Cost
expand button
Transcribed Image Text:(1) calculate the overhead assigned rate (note their order from above): Overhead Cost Estimated Cost Driver Activity Levels Activity Rate Items Overhead Purchasing $70,000 Number of purchası 700 $100 Handling $33,350 Number of material 1,334 $25 materials Machine setups $70,500 Number of machine 15,000 $4.70 Inspections $25,500 Number of inspecti 5,000 $5.10 Utilities $45,000 Square feet occupie 180,000 $0.25 (2) calculate the total order cost (again, note their order from above): Activity Cost Drivers Activity Levels Activity Rate Assigned Costs Total Order Cost
Expert Solution
Check Mark
Knowledge Booster
Background pattern image
Accounting
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Similar questions
SEE MORE QUESTIONS
Recommended textbooks for you
Text book image
FINANCIAL ACCOUNTING
Accounting
ISBN:9781259964947
Author:Libby
Publisher:MCG
Text book image
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Text book image
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Text book image
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Text book image
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Text book image
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education