#6
Younan Corporation manufactures two products: Product E47F andProduct D02M. The company is considering implementing anactivity-based costing (ABC) system that allocates itsmanufacturing overhead to four cost pools. The following additionalinformation is available for the company as a whole and forProducts E47F and D02M.
Activity CostPool ActivityMeasure Total Cost Total Activity Machining Machine-hours $ 165,000 11,000 MHs Machine setups Number of setups $ 150,000 250 setups Product design Number of products $ 70,000 2 products Order size Direct labor-hours $ 310,000 10,000 DLHs
ActivityMeasure ProductE47F ProductD02M Machine-hours 5,000 6,000 Number of setups 200 50 Number of products 1 1 Direct labor-hours 4,000 6,000
Using the ABC system, the percentage of the total overhead costthat is assigned to Product D02M is closest to:
rev: 03_17_2018_QC_CS-119201
22.30%
49.06%
26.76%
50.00%
#7
Tomasini Corporation has provided the following data from itsactivity-based costing accounting system:
Supervisory wages $ 660,000 Factory supplies $ 280,000
Distribution of Resource Consumption across Activity CostPools:
Activity Cost Pools BatchProcessing Unit Processing Other Total Supervisory wages 20% 70% 10% 100% Factory supplies 45% 35% 20% 100%
The "Other" activity cost pool consists of the costs of idlecapacity and organization-sustaining costs that are not assigned toproducts.
How much supervisory wages and factory supplies cost would NOTbe assigned to products using the activity-based costingsystem?
Garrison 16e Rechecks 2018-07-24
$280,000
$660,000
$122,000
$0
#9
Addleman Corporation has an activity-based costing system withthree activity cost pools--Processing, Supervising, and Other. Inthe first stage allocations, costs in the two overhead accounts,equipment expense and indirect labor, are allocated to the threeactivity cost pools based on resource consumption. Data used in thefirst stage allocations follow:
Overhead costs: Equipment expense $ 73,000 Indirect labor $ 1,000
Distribution of Resource Consumption Across Activity CostPools:
Activity Cost Pools Processing Supervising Other Equipment expense 0.20 0.10 0.70 Indirect labor 0.20 0.20 0.60
Processing costs are assigned to products using machine-hours(MHs) and Supervising costs are assigned to products using thenumber of batches. The costs in the Other activity cost pool arenot assigned to products. Activity data for the company's twoproducts follow:
Activity:
MHs(Processing) Batches(Supervising) Product W3 7,600 100 Product H3 2,400 900 Total 10,000 1,000
Finally, the costs of Processing and Supervising are combinedwith the following sales and direct cost data to determine productmargins.
Sales and Direct Cost Data:
Product W3 Product H3 Sales (total) $ 159,500 $ 154,100 Direct materials (total) $ 66,300 $ 55,300 Direct labor (total) $ 77,800 $ 84,100
The activity rate for the Supervising activity cost pool underactivity-based costing is closest to:
Garrison 16e Rechecks 2018-07-24
$7.50 per batch
$74.00 per batch
$1.11 per batch
$1.00 per batch
#6
Younan Corporation manufactures two products: Product E47F andProduct D02M. The company is considering implementing anactivity-based costing (ABC) system that allocates itsmanufacturing overhead to four cost pools. The following additionalinformation is available for the company as a whole and forProducts E47F and D02M.
| Activity CostPool | ActivityMeasure | Total Cost | Total Activity | ||
| Machining | Machine-hours | $ | 165,000 | 11,000 | MHs |
| Machine setups | Number of setups | $ | 150,000 | 250 | setups |
| Product design | Number of products | $ | 70,000 | 2 | products |
| Order size | Direct labor-hours | $ | 310,000 | 10,000 | DLHs |
| ActivityMeasure | ProductE47F | ProductD02M |
| Machine-hours | 5,000 | 6,000 |
| Number of setups | 200 | 50 |
| Number of products | 1 | 1 |
| Direct labor-hours | 4,000 | 6,000 |
Using the ABC system, the percentage of the total overhead costthat is assigned to Product D02M is closest to:
rev: 03_17_2018_QC_CS-119201
22.30%
49.06%
26.76%
50.00%
#7
Tomasini Corporation has provided the following data from itsactivity-based costing accounting system:
| Supervisory wages | $ | 660,000 |
| Factory supplies | $ | 280,000 |
Distribution of Resource Consumption across Activity CostPools:
| Activity Cost Pools | BatchProcessing | Unit Processing | Other | Total | |
| Supervisory wages | 20% | 70% | 10% | 100% | |
| Factory supplies | 45% | 35% | 20% | 100% | |
The "Other" activity cost pool consists of the costs of idlecapacity and organization-sustaining costs that are not assigned toproducts.
How much supervisory wages and factory supplies cost would NOTbe assigned to products using the activity-based costingsystem?
Garrison 16e Rechecks 2018-07-24
$280,000
$660,000
$122,000
$0
#9
Addleman Corporation has an activity-based costing system withthree activity cost pools--Processing, Supervising, and Other. Inthe first stage allocations, costs in the two overhead accounts,equipment expense and indirect labor, are allocated to the threeactivity cost pools based on resource consumption. Data used in thefirst stage allocations follow:
| Overhead costs: | |||||||
| Equipment expense | $ | 73,000 | |||||
| Indirect labor | $ | 1,000 | |||||
Distribution of Resource Consumption Across Activity CostPools:
| Activity Cost Pools | |||||
| Processing | Supervising | Other | |||
| Equipment expense | 0.20 | 0.10 | 0.70 | ||
| Indirect labor | 0.20 | 0.20 | 0.60 | ||
Processing costs are assigned to products using machine-hours(MHs) and Supervising costs are assigned to products using thenumber of batches. The costs in the Other activity cost pool arenot assigned to products. Activity data for the company's twoproducts follow:
Activity:
| MHs(Processing) | Batches(Supervising) | |
| Product W3 | 7,600 | 100 |
| Product H3 | 2,400 | 900 |
| Total | 10,000 | 1,000 |
Finally, the costs of Processing and Supervising are combinedwith the following sales and direct cost data to determine productmargins.
Sales and Direct Cost Data:
| Product W3 | Product H3 | |||||||||
| Sales (total) | $ | 159,500 | $ | 154,100 | ||||||
| Direct materials (total) | $ | 66,300 | $ | 55,300 | ||||||
| Direct labor (total) | $ | 77,800 | $ | 84,100 | ||||||
The activity rate for the Supervising activity cost pool underactivity-based costing is closest to:
Garrison 16e Rechecks 2018-07-24
$7.50 per batch
$74.00 per batch
$1.11 per batch
$1.00 per batch
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 | |
|
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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