Hosmer Industries provides the following information about resources and usage:Unused ResourcesCapacityCost DriverVolumeResources usedMaterialsPowerSetupsPurchasing$ 4,800$ 3,744$ 1,800$ 4,320Client assistance $18,240$ 8,160$ 6,7206,4002726264$ 235,200$ 42,912$ 57,600$ 50,400$ 37,440$ 69,600$ 67,200402563,360SupervisionFacility costResourcessuppliedMaterialsPowerSetupsPurchasingClient assistanceSupervisionFacility costSales revenue for Hosmer Industries is $720,000.Required:Prepare a traditional income statement.Prepare an activity-based income statement.poundshourssetupspurchaseordersinquirieslabor-hourssquare meters

The income statement is the statement under which all the revenue and expenses are reported for a…

Hosmer Industries provides the following information about resources and usage: Unused Resources Capacity Cost Driver Volume Resources used Materials Power Setups Purchasing Client assistance Supervision Facility cost Resources supplied Materials Power Setups Purchasing Client assistance Supervision Facility cost $ 4,800 $ 3,744 $ 1,800 $ 4,320 $ 18,240 $ 8,160 $ 6,720 $ 235,200 $ 42,912 $ 57,600 $ 50,400 $ 37,440 $ 69,600 $ 67,200 6,400 272 62 64 40 256 3,360 Sales revenue for Hosmer Industries is $720,000. Required: Prepare a traditional income statement. Prepare an activity-based income statement. pounds hours setups purchase orders inquiries labor-hours square meters

Hosmer Industries provides the following information about resources and usage: Unused Resources Capacity Cost Driver Volume Resources used Materials Power Setups Purchasing Client assistance Supervision Facility cost Resources supplied Materials Power Setups Purchasing Client assistance Supervision Facility cost $ 4,800 $ 3,744 $ 1,800 $ 4,320 $ 18,240 $ 8,160 $ 6,720 $ 235,200 $ 42,912 $ 57,600 $ 50,400 $ 37,440 $ 69,600 $ 67,200 6,400 272 62 64 40 256 3,360 Sales revenue for Hosmer Industries is $720,000. Required: Prepare a traditional income statement. Prepare an activity-based income statement. pounds hours setups purchase orders inquiries labor-hours square meters

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Please Answer part 4. Part 1-3 answers Part 1 Computation of Cost Allocation Rate for each activity: Activity Costs Base usage Allocation rate Material Handling 160,000 20,000 8 Packaging 390,000 2,000 195 Quality Assurance 112,000 1,600 70 Total 662,000 Part 2 Activity Usage of All Activities: Activity Commercial Travel Total Material Handling 8700 4450 13,150 Packaging 900 300 1,200 Quality Assurance 270 370 640 Allocation of Cost basis Usage: Activity Commercial Travel Material Handling 69,600 35600 (Activity Usage * Cost Allocation Rate) (8,700 * 8) (4450 * 8) Packaging 175,500 58500 Quality Assurance 18,900 25900 Total 264,000 120000 Units Produced 3,000 20000 Cost Per Unit 88 6 Part 3 Particulars Commercial Travel Usage of…
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Activity-Based Environmental Cost Assignments Pinter Company had the following environmental activities and product information: 1. Environmental activity costs Activity Costs Design products (to reduce pollution) $ 129,600 Test for contamination 230,400 Treat toxic waste 720,000 Operate pollution control equipment 576,000 2. Driver data Solvent X Solvent Y Design hours 2,900 1,900 Testing hours 5,100 7,700 Pounds of waste 600 15,400 Machine hours 2,900 61,100 3. Other production data Solvent X Solvent Y Nonenvironmental production costs $2,176,000 $4,128,000 Units produced 320,000 320,000 What if the design costs increased to $219,600 and the cost of toxic waste decreased to $360,000? Assume that Solvent Y uses 3,800 out of 7,600 design hours. Also assume that waste is cut by 50 percent and that Solvent Y is responsible for…
- X Data table - X More info Estimated activity Description of cost pool Estimated Cost Cost driver for this year Machine maintenance costs $ 440,000 Number of machine hours 11,000 340 kg of direct materials @ $50 per kg 70 direct labour hours used @ $30 per labour Engineering change orders $ 300,000 Number of change orders 6,000 hour Hazardous waste disposal $ 910,000 Kg of hazardous materials generated 3,500 140 machine hours used 2$ 1,650,000 Total overhead cost 9 change orders 65 kg of hazardous waste generated Scannell Industries manufactures a variety of custom products. The company has traditionally used a plantwide manufacturing overhead rate based an machine hours to allocate manufacturing overhead to its products. The company estimates that it will incur $1,650,000 in tolal manufacluring overhead costs in the upcoming year and will use 11,000 machine hours. Up to this point, hazardous waste disposal fees have been absorbed into the plantwide manufacturing overhead rate and…
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Station 9 ¾ Corporation manufacturers railroad tracks. They are currently using a traditional system, with machine hours as the cost driver. They are considering converting to an ABC system, and want a comparison of the two. Station 9 ¾ has identified the following activity information: Activity Cost Driver Est. Cost Driver Volume Est. Cost Pool Machining Machine Hours 12,000 $119,000 Assembly Direct Labor Hours 15,800 $107,000 Setup Number of Setups 9 $24,300 Total $250,300 The actual cost driver volume that occurred during the production process is below: Machine Hours 8,600 Direct Labor Hours 9,700 Number of Setups 7 What is the Difference between traditional and ABC system?
S [The following information applies to the questions displayed below.] Hosmer Industries provides the following information about resources and usage: Resources used Materials Power Setups Purchasing Client assistance Supervision Facility cost Resources supplied Materials Power Setups Purchasing Client assistance Supervision Facility cost Unused Resources Capacity $ 6,600 3,924 2,160 4,680 18,600 8,520 7,080 $ 352,200 47,988 59,076 62, 280 38,520 74,568 128,040 Required: a. Compute the cost driver rate for each resource. Cost Driver Volume 6,400 pounds 272 hours 62 setups 64 purchase orders 40 inquiries 256 labor-hours 3,360 square meters
West Co.'s manufacturing costs are as follows: Direct material and direct labor Other variable manufacturing costs $700,000 $100,000 Depreciation of factory building and manufacturing equipment $80,000 Other fixed manufacturing overhead $18,000 What amount should be considered product costs for external reporting purposes if the company uses absorption costing? A. $700,000 B. $800,000 C. $880,000 D. $898,000