FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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- Maxey & Sons manufactures two types of storage cabinets—Type A and Type B—and applies manufacturing overhead to all units at the rate of $120 per machine hour. Production information follows. Type A Type BAnticipated volume (units) 24,000 45,000 Direct-material cost per unit $ 28 $ 42 Direct-labor cost per unit 33 33 The controller, who is studying the use of activity-based costing, has determined that the firm’s overhead can be identified with three activities: manufacturing setups, machine processing, and product shipping. Data on the number of setups, machine hours, and outgoing shipments, which are the activities’ three respective cost drivers, follow. Type A Type B TotalSetups 140 100 240 Machine hours 48,000 67,500 115,500 Outgoing shipments 200 150 350 The firm’s total…arrow_forwardDineshbhaiarrow_forwardRequired information Greenwood Company manufactures two products-15,000 units of Product Y and 7,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Machining Machine setups Production design General factory Activity Measure Machining Number of setups Number of products Direct labor-hours Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Estimated Overhead Cost $ 227,700 $ 153,908 Product Y Product Z 8,700 60 1 8,700 2,300 210 1 1,300 Expected Activity 11,000 MHS 270 setups $ 91,000. $ 257,000 2 products 10,000 DLHS 14. Using the ABC system, what percentage of the Product Design cost is assigned to Product Y and Product Z? (Round your answers to 2…arrow_forward
- Foam Products, Incorporated, makes foam seat cushions for the automotive and aerospace industries. The company's activity-based costing system has four activity cost pools, which are listed below, along with their activity measures and activity rates: Activity Cost Pool Supporting direct labor. Batch processing Order processing Customer service Activity Measure Number of direct labor-hours Number of batches Number of orders Number of customers Activity Rate $10 per direct labor-hour $90 per batch $286 per order $ 2,602 per customer The company just completed a single order from Interstate Trucking for 2,800 custom seat cushions. The order was produced in four batches. Each seat cushion required 0.3 direct labor-hours. The selling price was $141.10 per unit, the direct materials cost was $102 per unit, and the direct labor cost was $14.20 per unit. This was Interstate Trucking's only order during the year. Required: Calculate the customer margin on sales to Interstate Trucking for the…arrow_forwardMaxey & Sons manufactures two types of storage cabinets—Type A and Type B—and applies manufacturing overhead to all units at the rate of $120 per machine hour. Production information follows. Type A Type BAnticipated volume (units) 24,000 45,000 Direct-material cost per unit $ 28 $ 42 Direct-labor cost per unit 33 33 The controller, who is studying the use of activity-based costing, has determined that the firm’s overhead can be identified with three activities: manufacturing setups, machine processing, and product shipping. Data on the number of setups, machine hours, and outgoing shipments, which are the activities’ three respective cost drivers, follow. Type A Type B TotalSetups 140 100 240 Machine hours 48,000 67,500 115,500 Outgoing shipments 200 150 350 The firm’s total…arrow_forwardNonearrow_forward
- Gable Company uses three activity pools. Each pool has a cost driver. Information for Gable Company follows: Total Cost of Pool $ 454,960 100,000 72,720 Estimated Cost Driver 96,800 10,000 505 Activity Pools Machining Designing costs Setup costs Suppose that Gable Company manufactures three products, A, B, and C. Information about these products follows: Product A Product B 38,000 4,000 40 Number of machine hours Number of design hours Number of batches Cost Driver Number of machine hours Number of design hours Number of batches Product A Product B Product C Total Overhead Assigned 48,000 2,200 170 Required: Using activity rates, determine the amount of overhead assigned to each product. Note: Do not round intermediate calculations. Round the final answer to nearest whole number. Product C 10,800 3,800 295arrow_forwardLarner Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains the following six activity cost pools and activity rates: Activity Cost Pool Labor-related Machine-related Machine setups Production orders. Shipments General factory Activity Rates $ 7.00 per direct labor-hour $ 4.00 per machine-hour $50.00 per setup $ 100.00 per order $ 150.00 per shipment $ 4.00 per direct labor-hour Cost and activity data have been supplied for the following products: Direct materials cost per unit Direct labor cost per unit 378 $ 3.00 $ 3.00 B52 $ 20.00 $ 6.00 2,000 100 Number of units produced per year Total Expected Activity 378 B52 Direct labor-hours. 1,000 20 Machine-hours 2,000 50 Machine setups 6 3 Production orders 5 3 8 3 Shipments Required: Compute the unit product cost of each product listed above. (Do not round intermediate calculations. Round your answers to 2 decimal places.) J78 B52 Unit product costarrow_forwardA company has provided the following data from its activity-based costing accounting system: Indirect factory wages Factory equipment depreciation S 27,000 $ 204,000 Distribution of Resource Consumption across Activity Cost Pools: Activity Cost Pools Indirect factory wages Factory equipment depreciation Product Processing 48% 25% Customer Orders Other 38 128 Total 100% 100% 63% The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs that are not assigned to products. Required: a. Determine the total amount of indirect factory wages and factory equipment depreciation costs that would be allocated to the Product Processing activity cost pool. b. Determine the total amount of indirect factory wages and factory equipment depreciation costs that would NOT be assigned to products. Complete this question by entering your answers in the tabs below. Required A Required B Determine the total amnount of indirect factory wages and factory equipment…arrow_forward
- i need the answer quicklyarrow_forwardRequired information [The following information applies to the questions displayed below.] Hickory Company manufactures two products-13,000 units of Product Y and 5,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all $829,500 of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z: Activity Cost Pool Machining Machine setups Product design Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Estimated Overhead Cost $ 246,000 Expected Activity 12,000 MHS $ 89,000 $ 357,000 14,400 250 setups 2 products DLHS $ 137,500 General factory Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product Y Product Z 7,500 40 1 8,500 4,500 210 1 5,900 2. Using the plantwide overhead rate, how much manufacturing…arrow_forwardanswer in text form please (without image)arrow_forward
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