>>>>_____ The following information is provided for Moon Antenna Corp., which manufactures two products: Lo-Gain antennas and Hi-Gain antennas for use in remote areas.(Click the icon to view the information.)Moon Antenna plans to produce 200 Lo-Gain antennas and 325 Hi-Gain antennas.Read the requirements.Requirement 1. Compute the indirect manufacturing cost per unit using direct labor hours as the allocation base for the single plantwide predetermined overhead allocation rate.First, compute the predetermined overhead (OH) allocation rate. (Round your answer to the nearest cent.)The predetermined overhead (OH) allocation rate isRequirements1. Compute the indirect manufacturing cost per unit using direct labor hours asthe allocation base for the single plantwide predetermined overhead allocationrate.2. Compute the indirect manufacturing cost per unit for each product usingactivity-based costing.Get more help.PrintDoneData tableActivitySetupMachine maintenanceTotal indirect manufacturing costsDirect labor hoursNumber of setupsNumber of machine hoursPrint$CostAllocation Base51,000 Number of setups42,000Number of machine hours$ 93,000Lo-Gain1,700503,250DoneHi-Gain4,300501,750Total6,0001005,000I

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Description: >>>>_____ The following information is provided for Moon Antenna Corp., which manufactures two products: Lo-Gain antennas and Hi-Gain antennas for use in remote areas.(Click the icon to view the information.)Moon Antenna plans to produce 200 Lo-Gain

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The following information is provided for Moon Antenna Corp., which manufactures two products: Lo-Gain antennas and Hi-Gain antennas for use in remote areas. (Click the icon to view the information.) Moon Antenna plans to produce 200 Lo-Gain antennas and 325 Hi-Gain antennas. Read the requirements. C Requirement 1. Compute the indirect manufacturing cost per unit using direct labor hours as the allocation base for the single plantwide predetermined overhead allocation rate. First, compute the predetermined overhead (OH) allocation rate. (Round your answer to the nearest cent.) hand you alltion to in

The following information is provided for Moon Antenna Corp., which manufactures two products: Lo-Gain antennas and Hi-Gain antennas for use in remote areas. (Click the icon to view the information.) Moon Antenna plans to produce 200 Lo-Gain antennas and 325 Hi-Gain antennas. Read the requirements. C Requirement 1. Compute the indirect manufacturing cost per unit using direct labor hours as the allocation base for the single plantwide predetermined overhead allocation rate. First, compute the predetermined overhead (OH) allocation rate. (Round your answer to the nearest cent.) hand you alltion to in

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 22E: Silven Company has identified the following overhead activities, costs, and activity drivers for the...

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Larsen, Inc., produces two types of electronic parts and has provided the following data: There are four activities: machining, setting up, testing, and purchasing. Required: 1. Calculate the activity consumption ratios for each product. 2. Calculate the consumption ratios for the plantwide rate (direct labor hours). When compared with the activity ratios, what can you say about the relative accuracy of a plantwide rate? Which product is undercosted? 3. What if the machine hours were used for the plantwide rate? Would this remove the cost distortion of a plantwide rate?
Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: Silven produces two models of cell phones with the following expected activity demands: 1. Determine the total overhead assigned to each product using the four activity drivers. 2. Determine the total overhead assigned to each model using the two most expensive activities. The costs of the two relatively inexpensive activities are allocated to the two expensive activities in proportion to their costs. 3. Using ABC as the benchmark, calculate the percentage error and comment on the accuracy of the reduced system. Explain why this approach may be desirable.
Box Springs. Inc., makes two sizes of box springs: queen and king. The direct material for the queen is $35 per unit and $55 is used in direct labor, while the direct material for the king is $55 per unit, and the labor cost is $70 per unit. Box Springs estimates it will make 4,300 queens and 3,000 kings in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?
Brees, Inc., a manufacturer of golf carts, has just received an offer from a supplier to provide 2,600 units of a component used in its main product. The component is a track assembly that is currently produced internally. The supplier has offered to sell the track assembly for 66 per unit. Brees is currently using a traditional, unit-based costing system that assigns overhead to jobs on the basis of direct labor hours. The estimated traditional full cost of producing the track assembly is as follows: Prior to making a decision, the companys CEO commissioned a special study to see whether there would be any decrease in the fixed overhead costs. The results of the study revealed the following: 3 setups1,160 each (The setups would be avoided, and total spending could be reduced by 1,160 per setup.) One half-time inspector is needed. The company already uses part-time inspectors hired through a temporary employment agency. The yearly cost of the part-time inspectors for the track assembly operation is 12,300 and could be totally avoided if the part were purchased. Engineering work: 470 hours, 45/hour. (Although the work decreases by 470 hours, the engineer assigned to the track assembly line also spends time on other products, and there would be no reduction in his salary.) 75 fewer material moves at 30 per move. Required: 1. Ignore the special study, and determine whether the track assembly should be produced internally or purchased from the supplier. 2. Now, using the special study data, repeat the analysis. 3. Discuss the qualitative factors that would affect the decision, including strategic implications. 4. After reviewing the special study, the controller made the following remark: This study ignores the additional activity demands that purchasing would cause. For example, although the demand for inspecting the part on the production floor decreases, we may need to inspect the incoming parts in the receiving area. Will we actually save any inspection costs? Is the controller right?
Plata Company has identified the following overhead activities, costs, and activity drivers for the coming year: Plata produces two models of microwave ovens with the following activity demands: The companys normal activity is 21,000 machine hours. Calculate the total overhead cost that would be assigned to Model X using an activity-based costing system: a. 230,000 b. 240,000 c. 280,000 d. 190,000
Thomsen Computer Company produces three products: Earth, Wind, and Fire. Earth requires 80 machine setups, Wind requires 60 setups, and Fire requires 180 setups. Thomsen has identified an activity cost pool with allocated overhead of $180000 for which the cost driver is machine setups. How much overhead is assigned to each product?
The following information is provided for Space Antenna Corp., which manufactures two products: Lo-Gain antennas and Hi-Gain antennas for use in remote areas. E (Click the icon to view the information.) Space Antenna plans to produce 50 Lo-Gain antennas and 325 Hi-Gain antennas. Read the requirements. Requirement 1. Compute the indirect manufacturing cost per unit using direct labor hours for the single plantwide predetermined overhead allocation rate. First, compute the predetermined overhead (OH) allocation rate. (Round your answer to the nearest cent.) The predetermined overhead (OH) allocation rate is - X Data Table Activity Cost Allocation Base Setup 51,000 Number of setups 42,000 Number of machine hours Machine maintenance %24 Total indirect manufacturing costs 93,000 Lo-Gain Hi-Gain Total Direct labor hours 1,600 4,400 6,000 Number of setups 20 20 40 Number of machine hours 3,500 1,500 5,000 Print Done
Pharoah Industries has three activity cost pools and two products. It expects to produce 2,800 units of Product SZ09 and 1,300 of Product NZ16. Having identified its activity cost pools and the cost drivers for each pool, Pharoah accumulated the following data relative to those activity cost pools and cost drivers. Activity Cost Pool Machine set-ups Assembling Inspection Machine set-ups Calculate the overhead rates. Assembling Inspection SZ09 $ Cost Driver Set-ups Machine hours NZ16 $ Inspections GA LA $ LA Assign the overhead cost to the two products. ta Estimated Overhead $63,600 354,000 6,160 Estimated Use of Cost Drivers per set-up 200 17,700 per inspection 110 per machine hour SZ09 130 NZ16 60 70 10,300 7,400 50
Deoro Company has identified the following overhead activities, costs, and activity drivers for the coming year:Deoro produces two models of dishwashers with the following expected prime costs and activity demands: The company’s normal activity is 8,000 direct labor hours.Required:1. Determine the unit cost for each model using direct labor hours to applyoverhead.2. Determine the unit cost for each model using the four activity drivers.3. Which method produces the more accurate cost assignment? Why?
Pronghorn Industries has three activity cost pools and two products. It estimates production 2,000 units of Product BC113 and 1,000 of Product AD908. Having identified its activity cost pools and the cost drivers for each pool, Pronghorn accumulated the following data relative to those activity cost pools and cost drivers. Activity Cost Pools Machine setup Machining Packing (a) Annual Overhead Data Activity Cost Pools Machine setup Using the above data, do the following: Machining Packing Cost Drivers $ Setups $ Machine hours Orders Estimated Overhead Estimated Overhead $17,500 120,750 28,670 Use of Cost Drivers per Product Estimated Use of Cost Drivers per Activity 35 Prepare a schedule showing the computations of the activity-based overhead rates per cost driver. 4,830 470 Estimated Use of Cost Drivers per Activity setups machine hours Product BC113 orders 20 1,140 120 $ $ $ Product AD908 15 3,690 350 Activity-Based Overhead Rates per setup per machine hr. per order
P Company produces three types of products- product A, product B and product C. Product A requires 600 machine setups and machine hours used on it were 2,000. Product B requires 900 machine setups and machine hours used on it were 1,000. Product C requires 500 machine setups and machine hours used on it were 2,000. The company has defined an activity cost pool machine setups for which the cost driver is number of machine setups. The total overhead cost assigned to that cost pool was sh.2,000, 000. a) The machine setups overhead assigned to product A: Select one: A. Sh. 800,000 B. Sh. 600,000 C. Sh. 400,000 D. None of the above
Aresco Corporation manufactures two products: Product G51B and Product E48X. 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 G51B and E48X. Activity Cost Pool Machining Machine setups Product design Order size Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Activity Measure Machine-hours Number of setups Number of products Direct labor-hours Product G51B 2,180 252 1 3,180 Total Cost $ 104,500 $ 304,500 $ 84,500 $ 381,500 Product E48X 2,820 248 1 6,820 Total Activity 5,000 MHS 500 setups 2 products 10,000 DLHS Required: a. Using the plantwide overhead rate, what percentage of the total overhead cost is allocated to Product G51B? b. Using the plantwide overhead rate, what percentage of the total…