ADMS 2510 Lecture Notes - Lecture 5: Deutsche Luft Hansa, Ob River, Snow Removal

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aquamarinesalmon656

4 Jun 2015

School

York University

Department

Administrative Studies

Course

ADMS 2510

Professor

Roberto Umana

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ADMS 2510 Full Course Notes

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Exercise 5-14 (30 minutes: first-stage allocations of overhead costs to the activity cost pools: Example: 20% of ,500 is ,500: computation of activity rates: Exercise 5-14 (continued: computation of the overhead costs for the hurntel order: *0. 6 dlh per unit 115 units = 69 dlhs: the customer margin for hurntel is computed as follows: Direct materials ( per unit 115 units) ,425. 00. Direct labour ( per dlh 0. 6 dlh per unit 115 units) Direct labour support overhead (see part 3 above) Order processing overhead (see part 3 above) Customer support overhead (see part 3 above) Problem 5-18 (45 minutes: the results of the first-stage allocation appear below: According to the data in the problem, 40% of the wages and salaries cost of ,000 is attributable. ,000 ,000 to activities related to job size. Other entries in the table are determined in a similar manner. (b) (a)

Related Questions

E7-11 - Please explain how you arrived at your answers.Thank you!

Exercise 7-11 Comprehensive Activity-Based Costing Exercise[LO2, LO3, LO4, LO5]

Silicon Optics has supplied thefollowing data for use in its activity-based costing system:

OverheadCosts
Wages andsalaries	$	354,000
Other overheadcosts		194,000

Total overheadcosts	$	548,000

Activity CostPool	ActivityMeasure	Total Activity
Direct laborsupport	Number of directlabor-hours	14,500	DLHs
Orderprocessing	Number of orders	590	orders
Customersupport	Number of customers	105	customers
Other	This is anorganization-sustaining activity	Notapplicable

	Distribution of Resource Consumption Across Activities
	Direct Labor Support		Order Processing		Customer Support		Other		Total
Wages andsalaries	20	%	30	%	20	%	30	%	100	%
Other overheadcosts	30	%	20	%	15	%	35	%	100	%

During the year, Silicon Optics completed an order for a specialoptical switch for a new customer, Indus Telecom. This customer didnot order any other products during the year. Data concerning thatorder follow:

Data Concerning the Indus Telecom Order
Selling price	$	290	per unit
Units ordered		100	units
Directmaterials	$	258	per unit
Directlabor-hours		1	DLH per unit
Direct laborrate	$	20	per DLH

Required:
1.	Prepare a report showing the first-stage allocations of overheadcosts to the activity cost pools. (Omit the "$" sign inyour response.)

	DirectLabor Support	Order Processing	Customer Support	Other	Totals
Wages andsalaries	$	$	$	$	$
Other overheadcosts

Total cost	$	$	$	$	$

2.	Compute the activity rates for the activity cost pools.(Round your answers to 2 decimalplaces.Omit the "$" sign in yourresponse.)

Activity CostPools	Activity Rate
Direct laborsupport	$	per DLH
Orderprocessing	$	per order
Customersupport	$	per customer

3.	Compute the overhead costs for the order from Indus Telecom,including customer support costs.(Round your intermediatecalculations and final answers to 2 decimal places. Omit the "$"sign in your response.)

Activity CostPool	ABCCost
Direct laborsupport	$
Orderprocessing
Customersupport

Total	$

4.	Prepare a report showing the customer margin for Indus Telecom.(Input all amounts as positive values except losses whichshould be indicated by a minus sign. Round your intermediatecalculations and final answers to 2 decimal places. Omit the "$"sign in your response.)

Indus Telecom Customer MarginâABC Analysis
(Click toselect)Direct laborSalesDirect labor support overheadDirectmaterialsShippingOrder processing overheadCustomer supportoverheadOther		$
Costs:
(Click to select)Customersupport overheadDirect materialsOtherDirect labor supportoverheadDirect laborOrder processing overheadShippingSales	$
(Click to select)Orderprocessing overheadCustomer support overheadShippingDirectlaborDirect labor support overheadDirect materialsOtherSales
(Click to select)DirectlaborDirect labor support overheadSalesOtherDirect materialsOrderprocessing overheadCustomer support overheadShipping
(Click toselect)SalesDirect laborCustomer support overheadShippingDirectmaterialsOrder processing overheadDirect labor supportoverheadOther
(Click to select)Orderprocessing overheadDirect labor support overheadCustomer supportoverheadOtherShippingSalesDirect materialsDirect labor

Customer margin		$

redzebra746

CancicoCommunications has supplied the following data for use in its ABCsystem:

Overhead Costs
Wages and salaries	$	297,500
Other overhead costs		164,000

Total overhead costs	$	461,500

Activity Cost Pool	ActivityMeasure	Total Activity
Direct labour support	Number of direct labour-hours	12,205	DLHs
Order processing	Number of orders	500	orders
Customer support	Number of customers	150	customers
Other	These costs are not allocated to products or customers	NA

	Distribution of Resource Consumption across Activity Cost Pools

	Direct Labour Support			Order Processing			Customer Support			Other			Total
Wages and salaries		15	%		40	%		35	%		10	%		100	%
Other overhead costs		10	%		25	%		25	%		40	%		100	%

During the year, CancicoCommunications completed an order for special telephone equipmentfor a new customer, HurnTel. This customer did not order any otherproducts during the year. Data concerning that order follow:


Selling price	$	217	per unit
Units ordered		185	units
Direct materials	$	195	per unit
Direct labour-hours		0.6	DLH perunit
Direct labour rate	$	25	per DLH
Prepare a report showing the overhead costs for the order fromHurnTel, inluding customer support costs. Prepare a report showing the customer margin for HurnTel

brownalpaca785

3-4. Miller Corporation uses an activity-based costing system with the following three activity cost pools:

Activity Cost: Total Activity

Fabrication 40,000 hours

Order Processing 500 orders

The Other activity cost pool is used to accumulate costs of idle capacity and organization-sustaining costs.
The company has provided the following data concerning its costs:

Wages and Salaries $420,000

Depreciation $100,000

Occupancy $120,000

Total $640,000

The distribution of resource consumption across activity cost pools is given below:

Fabrication Order Processing Other Total

Wages and Salaries 5% 80% 15% 100%

Depreciation 15% 45% 40% 100%

Occupancy 25% 50% 25% 100%

3. The total cost allocation to the Fabrication activity cost pool is:

A. $640,000
B. $100,000
C. $66,000
D. $30,000

4. The total cost allocation to the Order Processing activity cost pool is:

A. $441,000

B. $100,000

C. $640,000

D. $420,000

emeraldllama483

ADMS 2510 Lecture Notes - Lecture 5: Deutsche Luft Hansa, Ob River, Snow Removal

ADMS 2510 Full Course Notes

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