Question

Please help Accounting question

Snavely, Inc., manufactures and sells two products: Product E1 and Product A7. Data concerning the expected production of each product and the expected total direct labor-hours (DLHS) required to produce that output appear below: Direct Labor-Hours Per Unit Total Direct Labor- Hours 4,800 800 5,600 Expected Production 600 200 Product E1 Product A7 Total direct labor-hours 8.0 4.0 The direct labor rate is $2710 per DLH. The direct materials cost per unit for each product is given below: Direct Materials Cost per Unit $233.00 $285.00 Product E1 Product AZ The company has an activity-based costing system with the following activity cost pools, activity measures, and expected activity: Expected Activity Activity Measures DLHS setups MHS Activity Cost Pools Labor-related Machine setups Order size Estimated Overhead Cost $ 117,100 5 5,210 863,520 Product E1 4,800 700 2,900 Product A7 800 200 3,600 Tot 5, $1 35.830

Answer 1

Sol Total Overhead applied to product. Ar- Activity / Product Product I Total El IAT I Labor Related $100.371 1 $ 16,729 $ 117, 100 Machine Set ups 42,941 L 12.269 1 55,210 Order Size ! 385,263 478.257 363.520. Totaal $528,575 $ 507,255 $1,035,830 Total Overhead applied to product. A7= $507,255 Thus, the total Overhead applied to product AT Under Activity-based Costing is close to => $507,256 Vit

Worling Neteor Labour Related Overhead = $ 119,900 Product EL DLHg = 4800 Product AM Delts = 800 _ Toteut Dihs = 5600 Produet Ef $ 117,100 X 4800s $ 100,371 5600 - Product AT - $ 117,100 x_800 + $16,729 5600 ReuZy Machine Setup's Overhead = $55,210 Setup's in Product El = 700 Setuies in product AY = 200 Total Setup's = qod 9 Product E1 - $ 55,210 x 700_=> $42,941 Product A7 = $55,210 x 200 - $12,264 900

Order Size Overhead = $863,520 Product E1 MH'S = 2900 Product AT M H 3600 Total MH's 6500 - Product El ; $863,520x 2900_-> $385,263 6500 Product A4 = $863,520 X 3600 - $478,257 LOX 3600 6500