Hickory Company manufactures two productsâ13,000 units ofProduct Y and 5,000 units of Product Z. The company uses aplantwide overhead rate based on direct labor-hours. It isconsidering implementing an activity-based costing (ABC) systemthat allocates all of its manufacturing overhead to four costpools. The following additional information is available for thecompany as a whole and for Products Y and Z:
Activity CostPool ActivityMeasure Estimated Overhead Cost Expected Activity Machining Machine-hours $ 228,000 12,000 MHs Machine setups Number of setups $ 40,000 100 setups Productiondesign Number of products $ 74,000 2 products General factory Direct labor-hours $ 288,000 14,400 DLHs
ActivityMeasure Product Y Product Z Machine-hours 10,000 2,000 Number ofsetups 40 60 Number ofproducts 1 1 Directlabor-hours 7,000 7,400
Required: Using the plantwide overhead rate, what percentage of the totaloverhead cost is allocated to Product Y and Product Z?(Round your intermediate calculations to 2 decimal places.Round your "Percentage" answers to 2 decimal places. (i.e. 0.1234should be entered as 12.34).)
Using the ABC system, what percentage of the Machining costs isassigned to Product Y and Product Z? (Round yourintermediate calculations to 2 decimal places. Round your"Percentage" answers to 2 decimal places. (i.e. 0.1234 should beentered as 12.34).)
Using the ABC system, what percentage of the Product Design costis assigned to Product Y and Product Z? (Round your answersto 2 decimal places.)
Using the ABC system, whatpercentage of the General Factory cost is assigned to Product Y andProduct Z? (Round your intermediate calculations to 2decimal places. Round your "Percentage" answers to 2 decimalplaces. (i.e. 0.1234 should be entered as 12.34).)
Hickory Company manufactures two productsâ13,000 units ofProduct Y and 5,000 units of Product Z. The company uses aplantwide overhead rate based on direct labor-hours. It isconsidering implementing an activity-based costing (ABC) systemthat allocates all of its manufacturing overhead to four costpools. The following additional information is available for thecompany as a whole and for Products Y and Z: |
| Activity CostPool | ActivityMeasure | Estimated Overhead Cost | Expected Activity | ||
| Machining | Machine-hours | $ | 228,000 | 12,000 | MHs |
| Machine setups | Number of setups | $ | 40,000 | 100 | setups |
| Productiondesign | Number of products | $ | 74,000 | 2 | products |
| General factory | Direct labor-hours | $ | 288,000 | 14,400 | DLHs |
| ActivityMeasure | Product Y | Product Z | |||||
| Machine-hours | 10,000 | 2,000 | |||||
| Number ofsetups | 40 | 60 | |||||
| Number ofproducts | 1 | 1 | |||||
| Directlabor-hours | 7,000 | 7,400 | |||||
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Related questions
Hickory Company manufactures two productsâ15,000 units ofProduct Y and 7,000 units of Product Z. The company uses aplantwide overhead rate based on direct labor-hours. It isconsidering implementing an activity-based costing (ABC) systemthat allocates all of its manufacturing overhead to four costpools. The following additional information is available for thecompany as a whole and for Products Y and Z: (The totalestimated overhead cost may not agree with the sum of allocatedoverhead costs to each product.) |
| Activity CostPool | ActivityMeasure | Estimated Overhead Cost | Expected Activity | ||
| Machining | Machine-hours | $ | 227,700 | 11,000 | MHs |
| Machine setups | Number of setups | $ | 153,900 | 270 | setups |
| Productiondesign | Number of products | $ | 91,000 | 2 | products |
| General factory | Direct labor-hours | $ | 257,000 | 10,000 | DLHs |
| ActivityMeasure | Product Y | Product Z |
| Machining | 7,700 | 3,300 |
| Number ofsetups | 60 | 210 |
| Number ofproducts | 1 | 1 |
| Directlabor-hours | 8,700 | 1,300 |
| Required: |
| Using the ABC system, how muchtotal manufacturing overhead cost would be assigned to ProductY?(Round your intermediate calculations to 2 decimal placesand final answers to the nearest dollar amount.) |
| Total manufacturingoverhead cost | $ |
Hickory Company manufactures two productsâ14,000 units ofProduct Y and 6,000 units of Product Z. The company uses aplantwide overhead rate based on direct labor-hours. It isconsidering implementing an activity-based costing (ABC) systemthat allocates all of its manufacturing overhead to four costpools. The following additional information is available for thecompany as a whole and for Products Y and Z: |
| Activity CostPool | ActivityMeasure | Estimated Overhead Cost | Expected Activity | ||
| Machining | Machine-hours | $ | 203,000 | 10,000 | MHs |
| Machine setups | Number of setups | $ | 121,900 | 230 | setups |
| Productiondesign | Number of products | $ | 87,000 | 2 | products |
| General factory | Direct labor-hours | $ | 379,500 | 12,000 | DLHs |
| ActivityMeasure | Product Y | Product Z | |
| Machine-hours | 7,300 | 2,700 | |
| Number ofsetups | 50 | 180 | |
| Number ofproducts | 1 | 1 | |
| Directlabor-hours | 9,500 | 2,500 | |
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2. Using the plantwide overhead rate, how much manufacturingoverhead cost is allocated to Product Y and Product Z?(Round your intermediate calculations to 2 decimal placesand final answers to the nearest dollar amount.) 3. What is the activity rate for the Machining activity costpool? (Round your answer to 2 decimal places. 4. What is the activity rate for the Machine Setups activitycost pool?
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Hickory Company manufactures two productsâ14,000 units ofProduct Y and 6,000 units of Product Z. The company uses aplantwide overhead rate based on direct labor-hours. It isconsidering implementing an activity-based costing (ABC) systemthat allocates all of its manufacturing overhead to four costpools. The following additional information is available for thecompany as a whole and for Products Y and Z: |
| Activity CostPool | ActivityMeasure | Estimated Overhead Cost | Expected Activity | ||
| Machining | Machine-hours | $ | 203,000 | 10,000 | MHs |
| Machine setups | Number of setups | $ | 121,900 | 230 | setups |
| Productiondesign | Number of products | $ | 87,000 | 2 | products |
| General factory | Direct labor-hours | $ | 379,500 | 12,000 | DLHs |
| ActivityMeasure | Product Y | Product Z |
| Machine-hours | 7,300 | 2,700 |
| Number ofsetups | 50 | 180 |
| Number ofproducts | 1 | 1 |
| Directlabor-hours | 9,500 | 2,500 |
|
12. Using the ABC system, what percentage of the Machining costsis assigned to Product Y and Product Z? (Round yourintermediate calculations to 2 decimal places. Round your"Percentage" answers to 2 decimal places. (i.e. 0.1234 should beentered as 12.34).) 13. Using the ABC system, what percentage of Machine Setups costis assigned to Product Y and Product Z? (Round yourintermediate calculations to 2 decimal places. Round your"Percentage" answers to 2 decimal places. (i.e. 0.1234 should beentered as 12.34).) 14. Using the ABC system, what percentage of the Product Designcost is assigned to Product Y and Product Z? (Round youranswers to 2 decimal places.) 15. Using the ABC system, what percentage of the General Factorycost is assigned to Product Y and Product Z? (Round yourintermediate calculations to 2 decimal places. Round your"Percentage" answers to 2 decimal places. (i.e. 0.1234 should beentered as 12.34).) | ||
