FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Transcribed Image Text:XYZ Co. manufactures baseball bats and wooden tops. Currently, the company makes 5,000 baseball bats each
month. Each bat uses $1.00 in direct materials and $0.50 in direct labor. The company uses two activities in
Finish a
manufacturing the baseball bats: Cutting and Finishing. The cost associated with Cutting is $7,500 a month, allocated
on the basis of direct labor hours. The cost associated with Finishing is $12,500 a month, allocated on the basis of
batches. Baseball bats use 2/3 of the direct labor hours, and 40% of total batches. What is the total manufacturing
cost for one baseball bat?
O a. $3.5
O b. $3.46
O c. $2.96
O d. None of the given answer is correct.
O e. $3
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Transcribed Image Text:Time ler
Company XYZ is currently producing and selling 20,000 units. The selling price per unit is $10 while the variable cost
ratio is 20%. Assuming total fixed costs of $30,000, what is the margin of safety in ($) value?
O a. None of the given answers
Ob. 162,500
O c. 122,500
O d. 102,500
O e. 82,500
Salim is financial advisor and consultant. He wishes to go to Salalah during Al Khareef season. He is considering two
alternatives. The first one is to drive to Salalah. This option is expected to cost Salim about $150 in fuel cost. Salim
also can invite three of his friends to join the trip. Each one of them is expected to pay Salim $40. The other option for
Salim is to use Muwasalat bus service. Under this option Salim will also need to rent a car once he arrives to Salalah.
The total cost of this option including the bus ticket and the car rental is $400. Because the bus trip takes about 11
hours, Salim can use the time to provide consultation services that are expected to earn him $500 in total. If Salim
decided to use the bus to Salalah, what would be the differential cost ($) of the that option?
on
put of
O a. 120
O b. 500
C.
400
O d. None of the given answers
150
P Type here to search
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- Computer World, Inc. manufactures computer parts and keyboards. The annual production and sales of computer parts is 1,000 units, while 1,200 keyboards are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Computer parts require 3 direct labor hours per unit, while keyboards require 2.5 direct labor hours per unit. The total estimated overhead for the period is $114,000. The company is looking at the possibility of changing to an activity-based costing system for its products. What is the predetermined overhead allocation rate using the traditional costing system?arrow_forwardMarvel Parts, Incorporated, manufactures auto accessories. One of the company's products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 1,040 hours each month to produce 2,080 sets of covers. The standard costs associated with this level of production are: Total Direct materials $ 40,560 Direct labor $ 7,280 Per Set of Covers $ 19.50 3.50 Variable manufacturing overhead (based on direct labor-hours) $ 4,160 2.00 $ 25.00 During August, the factory worked only 600 direct labor-hours and produced 1,800 sets of covers. The following actual costs were recorded during the month: Per Set of Total Direct materials (5,000 yards) Direct labor $ 34,200 Covers $ 19.00 $ 6,660 3.70 $ 4,140 2.30 Variable manufacturing overhead $ 25.00 At standard, each set of covers should require 2.5 yards of material. All of the…arrow_forwardKaumajet Factory produces two products: table lamps and desk lamps. It has two separate departments: Fabrication and Assembly. The factory overhead budget for the Fabrication Department is $324,156, using 272,400 direct labor hours. The factory overhead budget for the Assembly Department is $295,263, using 61,900 direct labor hours. If a desk lamp requires 2 hours of fabrication and 5 hours of assembly, the amount of factory overhead that Kaumajet Factory will allocate to each unit of desk lamp using the multiple production department factory overhead rate method with an allocation base of direct labor hours is a.$4.77 b.$10.01 c.$70.05 d.$26.23arrow_forward
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- Marvel Parts, Incorporated, manufactures auto accessories. One of the company’s products is a set of seat covers that can be adjusted to fit nearly any small car. The company has a standard cost system in use for all of its products. According to the standards that have been set for the seat covers, the factory should work 990 hours each month to produce 1,980 sets of covers. The standard costs associated with this level of production are: Total Per Set of Covers Direct materials $ 45,738 $ 23.10 Direct labor $ 6,930 3.50 Variable manufacturing overhead (based on direct labor-hours) $ 3,168 1.60 $ 28.20 During August, the factory worked only 1,000 direct labor-hours and produced 2,500 sets of covers. The following actual costs were recorded during the month: Total Per Set of Covers Direct materials (10,000 yards) $ 56,000 $ 22.40 Direct labor $ 9,250 3.70 Variable manufacturing overhead $ 4,500 1.80 $ 27.90 At standard, each set of covers…arrow_forwardSheffield Corp. is planning to produce 600 composting bins and sell 580 composting bins during March. Each composting bin requires 500 grams of plastic and one-half hour of direct labor. Plastic costs $12 per 500 grams and employees of the company are paid $20 per hour. Manufacturing overhead is applied at a rate of 120% of direct labor costs. Sheffield has 400 kilos of plastic in beginning direct materials inventory and wants to have 400 kilos in ending direct materials inventory. What is total amount budgeted for direct labor in March? O $144000 O $6000 $8000 O $16000arrow_forwardKaumajet Factory produces two products: table lamps and desk lamps. It has two separate departments: Fabrication and Assembly. The factory overhead budget for the Fabrication Department is $928,620, using 469,000 direct labor hours. The factory overhead budget for the Assembly Department is $615,451, using 69,700 direct labor hours. If a desk lamp requires 5 hours of fabrication and 8 hours of assembly, the amount of factory overhead that Kaumajet Factory will allocate to each unit of desk lamp using the multiple production department factory overhead rate method with an allocation base of direct labor hours is a.$8.83 b.$22.15 c.$287.97 d.$80.54arrow_forward
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