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

Related questions

Question
HITech Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The
company, which uses activity-based costing, has identified five activities (and related cost drivers). Each
activity, its budgeted cost, and related cost driver is identified below.
Activity
Material handling
Material insertion
Cost
$ 225,000
2,475,000
840,000
170,000
Cost Driver
Number of parts
Number of parts
Machine hours
Automated machinery
Finishing
Packaging
Total
Direct labor hours
170.000
$3,880,000
Orders shipped
The following information pertains to the three product lines for next year:
Economy
10,000
1,000
Standard
5,000
500
Deluxe
2,000
200
Units to be produced
Orders to be shipped
Number of parts per unit
Machine hours per unit
Labor hours per unit
10
15
25
1
3
5
2
2
Assume that HiTech is using a volume-based costing system, and the preceding overhead costs are applied
to all products on the basis of direct labor hours. The overhead cost that would be assigned to the
Standard product line is closest to:
expand button
Transcribed Image Text:HITech Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses activity-based costing, has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below. Activity Material handling Material insertion Cost $ 225,000 2,475,000 840,000 170,000 Cost Driver Number of parts Number of parts Machine hours Automated machinery Finishing Packaging Total Direct labor hours 170.000 $3,880,000 Orders shipped The following information pertains to the three product lines for next year: Economy 10,000 1,000 Standard 5,000 500 Deluxe 2,000 200 Units to be produced Orders to be shipped Number of parts per unit Machine hours per unit Labor hours per unit 10 15 25 1 3 5 2 2 Assume that HiTech is using a volume-based costing system, and the preceding overhead costs are applied to all products on the basis of direct labor hours. The overhead cost that would be assigned to the Standard product line is closest to:
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