Survey Of Accounting
5th Edition
ISBN: 9781259631122
Author: Edmonds, Thomas P.
Publisher: Mcgraw-hill Education,
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Chapter 13, Problem 4E
To determine
Classifying each items under unit-level, batch-level, product-level or facility level costs.
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Students have asked these similar questions
Question 4: Match Set A with Set B
Set A
Set B
A. Allocate indirect and overhead costs to unit of products based
on what actually used.
1. MOOP costing
B. Where costs vary by machine, operation, department, or some
other overhead costs.
2. Depreciation
C. Start once manufacturing operations, tooling, set-up time and
cycle time are estimated.
3. Operation costing
4. PHC costing
D. Allocate an amount of money over the recovery life of asset.
E. Estimate costs based on future and actual expenditure.
5. ABC costing
Set A
1
3
4
5
Set B
Your choice
PART 1: COMPLETING MISSING INFORMATION
BONZZE Electronics manufactures two large-screen television models: the Foyale which sells for $1,800, and a new model,
the Lajestic, which sells for $1,350. The production cost computed per unit under traditional costing for each model in 2021
was as follows.
Traditional Costing
Foyale
Lajestic
Direct materials
Direct labor ($20 per hour)
Mfg overhead ($38 per DLH)
Total per unit cost
$1,200
In 2021, BONZZE
manufactured 26,000 units of the Foyale and 10,000 units of the Lajestic. The overhead rate of $38 per
direct labor hour was determined by dividing total expected manufacturing overhead of $7,500,000 by the total direct labor
hours (200,000) for the two models.
Under traditional costing, the gross profit on the models was Foyale $600 or ($1,800 - $1,200), and Lajestic $570 or ($1,350 -
$780). Because of this difference, management is considering phasing out the Foyale model and increasing the produc- tion of
the Lajestic model.
Cost Driver…
Question 2
A.
B.
C.
How does Activity-Based Costing differ from traditional costing?
Identify any TWO (2) advantages and any TWO (2) limitations of Activity-Based
Costing.
(4 marks)
McNish Enterprise manufactures and sells two products, Standard and Premium. The
company uses the activity-based costing system to allocate its overhead costs. The
following information has been collected relating to the SIX (6) overhead activities:
Activity
Purchase Orders
Quality Control
Material Handling
Setup Cost
Cost
$ 400 500
$ 275 000
$ 150 000
$ 50 000
$ 125 000
$ 240 000
$1240 500
The activity-based usage quantities for each product are as follows:
Production Scheduling
Procurement
Number of
Setups
Orders
900
1 600
(2 marks)
Number of
Inspection
500
500
Number of Orders
Executed
Standard 300
750
Premium 200
1 250
Total
500
2.500
2 000
1 000
The company produces 5 000 units of Standard and 4 000 units of Premium
calculated in (i.) above.
iii. Calculate the unit cost for each product.
Required:
i.…
Chapter 13 Solutions
Survey Of Accounting
Ch. 13 - Prob. 1QCh. 13 - Prob. 2QCh. 13 - Prob. 3QCh. 13 - Prob. 4QCh. 13 - Prob. 5QCh. 13 - Prob. 6QCh. 13 - Prob. 7QCh. 13 - Prob. 8QCh. 13 - Prob. 9QCh. 13 - Prob. 10Q
Ch. 13 - Prob. 11QCh. 13 - Prob. 12QCh. 13 - Prob. 13QCh. 13 - Prob. 14QCh. 13 - Prob. 15QCh. 13 - Prob. 16QCh. 13 - Prob. 17QCh. 13 - Prob. 18QCh. 13 - Prob. 19QCh. 13 - Prob. 1ECh. 13 - Prob. 2ECh. 13 - Prob. 3ECh. 13 - Prob. 4ECh. 13 - Exercise 6-5AOpportunity costs Norman Dowd owns...Ch. 13 - Prob. 6ECh. 13 - Prob. 7ECh. 13 - Prob. 8ECh. 13 - Prob. 9ECh. 13 - Prob. 10ECh. 13 - Exercise 6-11AEstablishing price for an...Ch. 13 - Exercise 6-12AOutsourcing decision with...Ch. 13 - Exercise 6-13AOutsourcing decision affected by...Ch. 13 - Prob. 14ECh. 13 - Exercise 6-15ASegment elimination decision Dudley...Ch. 13 - Prob. 16ECh. 13 - Exercise 6-17AAsset replacementopportunity cost...Ch. 13 - Prob. 18ECh. 13 - Exercise 6-19A Asset replacement decision Mead...Ch. 13 - Exercise 6-20A Asset replacement decision Kahn...Ch. 13 - Exercise 6-21A Annual versus cumulative data for...Ch. 13 - Problem 6-23A Context-sensitive relevance Required...Ch. 13 - Problem 6-24A Context-sensitive relevance...Ch. 13 - Problem 6-25A Effect of order quantity on special...Ch. 13 - Problem 6-26A Effects of the level of production...Ch. 13 - Problem 6-28A Eliminating a segment Western Boot...Ch. 13 - Effect of activity level and opportunity cost on...Ch. 13 - Problem 6-30A Comprehensive problem including...Ch. 13 - Prob. 29PCh. 13 - ATC 6-1 Business Application Case Analyzing...Ch. 13 - ATC 6-2 Group Assignment Relevance and cost...Ch. 13 - Prob. 3ATCCh. 13 - Prob. 4ATCCh. 13 - Prob. 5ATC
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