Product-Costing Accuracy, Consumption Ratios, Activity Rates, Activity Costing Tristar Manufacturing produces two types of battery-operated toy soldiers: infantry and special forces. The soldiers are produced by using one continuous process. Four activities have been identified: machining, setups, receiving, and packing. Resource drivers have been used to assign costs to each activity. The overhead activities, their costs, and the other related data are as follows: Product Machine Hours Setups Receiving Orders Packing Orders Infantry 20,000 300 900 1,600 Special forces 20,000 100 100 800 Costs $80,000 $24,000 $18,000 $30,000 Required: Question Content Area 1. Calculate the total overhead assigned to each product by using only machine hours to calculate a plantwide rate. (Round overhead rate answer to two decimal places and other answers to the nearest dollar.) The overhead rate is $fill in the blank c78a72021fa3067_1 per machine hour. The total overhead assigned to the infantry product is $fill in the blank c78a72021fa3067_2. The total overhead assigned to the Special Forces product is $fill in the blank c78a72021fa3067_3. 2. Calculate consumption ratios for each activity. (Round your answers to two decimal places.) Consumption Ratios Overhead Activity Infantry Special forces Machining fill in the blank c78a72021fa3067_4 fill in the blank c78a72021fa3067_5 Setups fill in the blank c78a72021fa3067_6 fill in the blank c78a72021fa3067_7 Receiving fill in the blank c78a72021fa3067_8 fill in the blank c78a72021fa3067_9 Packing fill in the blank c78a72021fa3067_10 fill in the blank c78a72021fa3067_11 Question Content Area 3. Calculate a rate for each activity by using the associated driver. Machining: $fill in the blank 2422d9f94f9f030_1 per machine hour Setups: $fill in the blank 2422d9f94f9f030_2 per setup Receiving: $fill in the blank 2422d9f94f9f030_3 per receiving order Packing: $fill in the blank 2422d9f94f9f030_4 per packing order
Process Costing
Process costing is a sort of operation costing which is employed to determine the value of a product at each process or stage of producing process, applicable where goods produced from a series of continuous operations or procedure.
Job Costing
Job costing is adhesive costs of each and every job involved in the production processes. It is an accounting measure. It is a method which determines the cost of specific jobs, which are performed according to the consumer’s specifications. Job costing is possible only in businesses where the production is done as per the customer’s requirement. For example, some customers order to manufacture furniture as per their needs.
ABC Costing
Cost Accounting is a form of managerial accounting that helps the company in assessing the total variable cost so as to compute the cost of production. Cost accounting is generally used by the management so as to ensure better decision-making. In comparison to financial accounting, cost accounting has to follow a set standard ad can be used flexibly by the management as per their needs. The types of Cost Accounting include – Lean Accounting, Standard Costing, Marginal Costing and Activity Based Costing.
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Product-Costing Accuracy, Consumption Ratios, Activity Rates, Activity Costing
Tristar Manufacturing produces two types of battery-operated toy soldiers: infantry and special forces. The soldiers are produced by using one continuous process. Four activities have been identified: machining, setups, receiving, and packing. Resource drivers have been used to assign costs to each activity. The
overhead activities, their costs, and the other related data are as follows:Product Machine Hours Setups Receiving Orders Packing Orders Infantry 20,000 300 900 1,600 Special forces 20,000 100 100 800 Costs $80,000 $24,000 $18,000 $30,000
Required:Question Content Area
1. Calculate the total overhead assigned to each product by using only machine hours to calculate a plantwide rate. (Round overhead rate answer to two decimal places and other answers to the nearest dollar.)
The overhead rate is $fill in the blank c78a72021fa3067_1 per machine hour.
The total overhead assigned to the infantry product is $fill in the blank c78a72021fa3067_2.
The total overhead assigned to the Special Forces product is $fill in the blank c78a72021fa3067_3.
2. Calculate consumption ratios for each activity. (Round your answers to two decimal places.)
Consumption Ratios Overhead Activity Infantry Special forces Machining fill in the blank c78a72021fa3067_4 fill in the blank c78a72021fa3067_5 Setups fill in the blank c78a72021fa3067_6 fill in the blank c78a72021fa3067_7 Receiving fill in the blank c78a72021fa3067_8 fill in the blank c78a72021fa3067_9 Packing fill in the blank c78a72021fa3067_10 fill in the blank c78a72021fa3067_11 Question Content Area
3. Calculate a rate for each activity by using the associated driver.
Machining: $fill in the blank 2422d9f94f9f030_1 per machine hour Setups: $fill in the blank 2422d9f94f9f030_2 per setup Receiving: $fill in the blank 2422d9f94f9f030_3 per receiving order Packing: $fill in the blank 2422d9f94f9f030_4 per packing order Question Content Area
Tristar ManufacturingOverhead Assignment4. Assign the overhead costs to each product by using the activity rates computed in Requirement 3.
Infantry Special forces Machining $fill in the blank 699dc105005e017_1 $fill in the blank 699dc105005e017_2 Setups fill in the blank 699dc105005e017_3 fill in the blank 699dc105005e017_4 Receiving fill in the blank 699dc105005e017_5 fill in the blank 699dc105005e017_6 Packing fill in the blank 699dc105005e017_7 fill in the blank 699dc105005e017_8 Total $fill in the blank 699dc105005e017_9 $fill in the blank 699dc105005e017_10 Question Content Area
5. CONCEPTUAL CONNECTION: Complete the statements below on the difference between the assignment calculated in Requirement 1 and the activity-based assignment.
Using only machine hours
the infantry product and
the special forces product. The
reveal this before the actual calculations are made.
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