An order for 1,000 boxes of Product X has the following production requirements:• 20 machine setups5,000 kilos of raw materials2,000 kilos of hazardous materials40 quality control inspections250 machine hoursRequired:a Suppose the company were to use a single, predetermined overhead rate basedon machine hours, calculate the rate per hour.b. Using the single plant-wide rate, what is the total overhead assigned and theoverhead cost per box of Product X?Calculate the total overhead that should be assigned to the Product X order.C.d.What is the overhead cost per box of Product X? P13-4 The cost accountant of Tacoma Manufacturing Company, manufacturer of Product X,· has established the following overhead cost pools and activity drivers:BudgetedOverheadActivity DriverP100,000 Number of setups75,000 Weight of raw materials30,000 Weight of hazardouschemicals usedOverhead cost poolMachine setupMaterial handlingHazardous waste controlQuality control inspectionOther overhead costs12,000 Number of inspections21,000 Machine hoursP238,000TotalBudgetedlevel foractivity driver200 P500 per setup30,000 kilos P2.50 per kilo10,000 kilos P3.00 per kiloOverhead cost poolOverhead rateMachine setupMaterial handlingHazardous waste controlQuality control inspectionOther overhead costs500 P24.00 per inspection5,000 P4.20 per machine hour

Under traditional costing, the overhead is assigned on the basis of single overhead rate but under…

Answered: P13-4 The cost accountant of Tacoma…

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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Activity-Based Costing Zeus Industries manufactures two types of electrical power units, custom and standard, which involve four factory overhead activities—production setup, procurement, quality control, and materials management. An activity analysis of the overhead revealed the following estimated activity costs and activity bases for these activities: Activity Activity Cost Activity Base Production setup $ 44,000 Number of setups Procurement 13,500 Number of purchase orders (PO) Quality control 97,500 Number of inspections Materials management 84,000 Number of components Total $239,000 The activity-base usage quantities for each product are as follows: Setups PurchaseOrders Inspections Components Unit Volume Custom 290 760 1,200 500 2,000 Standard 110 140 300 200 2,000 Total 400 900 1,500 700 4,000 a. Determine an activity rate for each activity. Activity Rates Production Setup Procurement Quality Control…
Activity Rates and Product Costs using Activity-Based Costing Garfield Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Activity BudgetedActivity Cost Activity Base Casting $560,000 Machine hours Assembly 75,000 Direct labor hours Inspecting 30,000 Number of inspections Setup 18,750 Number of setups Materials handling 14,000 Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Entry Dining Total Machine hours 7,500 12,500 20,000 Direct labor hours 2,000 3,000 5,000 Number of inspections 500 250 750 Number of setups 150 100 250 Number of loads 400 300 700 Units produced 5,000 2,500 7,500 a.…
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28) Blakely charges manufacturing overhead to products by using a predetermined application computed on the basis of machine hours. The following data pertain to the current year: Budgeted manufacturing overhead: $480,000 Actual manufacturing overhead: $440,000 Budgeted machine hours: 20,000 Actual machine hours: 16,000 Overhead applied to production totaled: A) S600,000. B) $352,000. O 5384,000. D) S550,000. E) some other amount.
Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity Capacity $138,000 Number of setups 10,200 Number of orders 92,400 Machine hours 18,480 Receiving hours phones with the following expected activity demands: Setting up equipment Ordering materials Machining Receiving Silven produces two models of cell Model X 5,000 80 200 6,600 385 Units completed Number of setups Number of orders Machine hours Receiving hours Required: Model Y 10,000 40 400 4,950 770 120 600 11,550 1,155
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…
Garfield Inc. manufactures entry and dining room lighting fixtures. Five activities are used in manufacturing the fixtures. These activities and their associated budgeted activity costs and activity bases are as follows: Budgeted Activity Activity Cost Activity Base Casting $99,820 Machine hours Assembly 58,900 Direct labor hours Inspecting 21,252 Number of inspections Setup 33,221 Number of setups Materials handling 34,830 Number of loads Corporate records were obtained to estimate the amount of activity to be used by the two products. The estimated activity-base usage quantities and units produced follow: Activity Base Entry Dining Total Machine hours 2,101 1,119 3,220 Direct labor hours 791 2,309 3,100 Number of inspections 724 288 1,012 Number of setups 175 64 239 Number of loads 544 230 774 Units produced 6,569 1,747 8,316
18. Using ABC, the total overhead costs charged to the 1,000 boxes of powdered chemical is:
From the schedule below provided for quality control activities, determine the appraisal costs: Quality control activities Activity cost Finished goods inspection $12,000 Product design $22,000 Rework $8,900 Processing returned products $21,000 Training of machine operators $25,000 Process audit $32,000 $29.900 $33,000 $66.000 $44.000
Pharoah Co. has identified an activity cost pool to which it has allocated estimated overhead of $10212000. It has determined the expected use of cost drivers for that activity to be 851000 inspections. Widgets require 217000 inspections, Gadgets 167000 inspections, and Targets 467000 inspections. How much is the overhead assigned to each product? O Widgets $3404000, Gadgets $3404000, Targets $3404000 O Widgets $217000, Gadgets $167000, Targets $467000 O Widgets $3404000, Gadgets $1702000, Targets $5106000 O Widgets $2604000, Gadgets $2004000, Targets $5604000
P13-3 Renton manufactures three types of office equipment: Bronze, Silver, and Gold and uses an activity-based product costing system. Seattle has identified five activities. Each activity, its cost and related activity driver is summarized below: Activity Material handling Cost Activity Driver P 120,000 Number of parts 240,000 Number of parts 350,000 150,000 Material insertion Automated Machine hours Labor hours Machinery finishing Packaging Total 90,000 Orders shipped P 950,000 The following information pertains to each product line: Silver Gold Bronze 2,000 4,000 800 Units to be produced Orders to be shipped Number of parts per unit Machine hours per unit Labor hours per unit 6,000 1,200 400 8 4 3 1 3 Required: Calculate the per unit cost of Bronze, Silver, and Gold using an activity-based costing system. 523

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