Roberts Company produces two weed eaters: basic and advanced. The company has four activi- ties: machining, engineering, receiving, and inspection. Information on these activities and their drivers is given below. Basic Advanced Total Units produced 100,000 300,000 $30,000,000 500,000 3,600 1,200 $38,000,000 600,000 Prime costs S8,000,000 100,000 Machine hours Engineering hours Receiving orders Inspection hours 400 4,000 1,600 400 800 1,600 2,400 Overhead costs: Machining Engineering Receiving Inspecting products $6,000,000 2,000,000 560,000 360,000 Required: 1. Calculate the four activity rates. 2. Calculate the unit costs using activity rates. Also, calculate the overhead cost per unit. 3. What if consumption ratios instead of activity rates were used to assign costs instead of activity rates? Show the cost assignment for the inspection activity.

Roberts Company produces two weed eaters: basic and advanced. The company has four activi- ties: machining, engineering, receiving, and inspection. Information on these activities and their drivers is given below. Basic Advanced Total Units produced 100,000 300,000 $30,000,000 500,000 3,600 1,200 $38,000,000 600,000 Prime costs S8,000,000 100,000 Machine hours Engineering hours Receiving orders Inspection hours 400 4,000 1,600 400 800 1,600 2,400 Overhead costs: Machining Engineering Receiving Inspecting products $6,000,000 2,000,000 560,000 360,000 Required: 1. Calculate the four activity rates. 2. Calculate the unit costs using activity rates. Also, calculate the overhead cost per unit. 3. What if consumption ratios instead of activity rates were used to assign costs instead of activity rates? Show the cost assignment for the inspection activity.

Name: Roberts Company produces two weed eaters: basic and advanced. The com
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Description: Roberts Company produces two weed eaters: basic and advanced. The company has four activi-ties: machining, engineering, receiving, and inspection. Information on these activities and theirdrivers is given below.BasicAdvancedTotalUnits produced100,00

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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