Harbour Company makes two models of electronic tablets, the Home
and the Work. Basic production information follows:
Home | Work | |||||
Direct materials cost per unit | $ | 42 | $ | 68 | ||
Direct labor cost per unit | 21 | 38 | ||||
Sales price per unit | 361 | 572 | ||||
Expected production per month | 670 | units | 470 | units | ||
Harbour has monthly overhead of $175,865, which is divided into the following cost pools:
Setup costs | $ | 76,140 |
Quality control | 64,525 | |
Maintenance | 35,200 | |
Total | $ | 175,865 |
The company has also compiled the following information about
the chosen cost drivers:
Home | Work | Total | |
Number of setups | 37 | 57 | 94 |
Number of inspections | 320 | 405 | 725 |
Number of machine hours | 1,200 | 2,000 | 3,200 |
Required:
1. Suppose Harbour uses a traditional costing
system with machine hours as the cost driver. Determine the amount
of overhead assigned to each product line. (Do not round
intermediate calculations and round your final answers to the
nearest whole dollar amount.)
2. Calculate the production cost per unit for each
of Harbour’s products under a traditional costing system.
(Round your intermediate calculations and final answers to
2 decimal places.)
3. Calculate Harbour’s gross margin per unit
for each product under the traditional costing system.
(Round your intermediate calculations and final answers to
2 decimal places.)
4. Select the appropriate cost driver for each cost pool and calculate the activity rates if Harbour wanted to implement an ABC system.
5. Assuming an ABC system, assign overhead costs
to each product based on activity demands.
6. Calculate the production cost per unit for each
of Harbour’s products in an ABC system. (Round your
intermediate calculations and final answers to 2 decimal
places.)
7. Calculate Harbour’s gross margin per unit
for each product under an ABC system. (Round your
intermediate calculations and final answers to 2 decimal
places.)
8. Compare the gross margin of each product under the traditional system and ABC. (Round your answers to 2 decimal places.)
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work Direct materials cost per unit $ 39 $ 62 Direct labor cost per unit 18 32 Sales price per unit 364 571 Expected production per month 640 units 370 units Harbour has monthly overhead of $198,050, which is divided into the following cost pools: Setup costs $ 80,510 Quality control 66,240 Maintenance 51,300 Total $ 198,050 The company has also compiled...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work Direct materials cost per unit $ 42 $ 69 Direct labor cost per unit 21 31 Sales price per unit 368 576 Expected production per month 670 units 480 units Harbour has monthly overhead of $219,720, which is divided into the following cost pools: Setup costs $ 92,020 Quality control 61,200 Maintenance 66,500 Total $ 219,720 The company has also compiled...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work Direct materials cost per unit $ 44 $ 71 Direct labor cost per unit 18 34 Sales price per unit 365 574 Expected production per month 800 units 350 units Harbour has monthly overhead of $180,010, which is divided into the following cost pools: Setup costs $ 79,050 Quality control 65,760 Maintenance 35,200 Total $ 180,010 The company has also compiled...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work Direct materials cost per unit $ 36 $ 64 Direct labor cost per unit 19 35 Sales price per unit 356 572 Expected production per month 610 units 440 units Harbour has monthly overhead of $210,470, which is divided into the following cost pools: Setup costs $ 80,510 Quality control 65,960 Maintenance 64,000 Total $ 210,470 The company has also compiled...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work Direct materials cost per unit $ 44 $ 71 Direct labor cost per unit 23 35 Sales price per unit 369 573 Expected production per month 740 units 410 units Harbour has monthly overhead of $187,410, which is divided into the following cost pools: Setup costs $ 86,110 Quality control 58,800 Maintenance 42,500 Total $ 187,410 The company...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work Direct materials cost per unit $ 36 $ 71 Direct labor cost per unit 25 31 Sales price per unit 360 575 Expected production per month 680 units 390 units Harbour has monthly overhead of $199,680, which is divided into the following cost pools: Setup costs $ 81,810 Quality control 68,870 Maintenance 49,000 Total $ 199,680 The company has also compiled...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Direct materials cost per unit Direct labor cost per unit Sales price per unit Expected production per month Home Work $ 42 $ 62 18 36 353 566 740 units 320 units Harbour has monthly overhead of $193,260, which is divided into the following cost pools: Setup costs Quality control Maintenance Total $ 82,840 63,920 46,500 $ 193,260 The company has also compiled...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Direct materials cost per unit Direct labor cost per unit Sales price per unit Expected production per month Home Work $ 37 $ 71 19 40 354 570 760 units 420 units Harbour has monthly overhead of $197,450, which is divided into the following cost pools: Setup costs Quality control Maintenance Total $ 80,360 64,390 52,700 $ 197,450 The company has also compiled...
Harbour Company makes two models of electronic tablets, the Home and the Work Basic production information follows: 5 65 $44 20 Direct materials cost per unit Direct labor cost per unit Sales price per unit Expected production per month 367 583 790 units 500 units Harbour has monthly overhead of $191,680, which is divided into the following cost pools: Setup costs Quality control Maintenance $ 85,680 57.469 48,600 $191,680 Total The company has also compiled the following information about the...
Harbour Company makes two models of electronic tablets, the Home and the Work. Basic production information follows: Home Work $ 37 $ 71 15 363 578 620 units 470 units Direct materials cost per unit Direct labor cost per unit Sales price per unit Expected production per month 37 Harbour has monthly overhead of $186,180, which is divided into the following cost pools: Setup costs Quality control Maintenance Total $ 86,920 55,760 43,500 $186, 180 The company has also compiled...