Hi-Tek Manufacturing, Inc., makes two types of industrial component parts—the B300 and the T500. An absorption costing income statement for the most recent period is shown:
1) | predetermined overhead rate | ||||||||
total estimated manufacturing overhead/total estimated direct labor dollars | |||||||||
510739/163300 | |||||||||
3.127612 | |||||||||
product margin using traditional appraoch | |||||||||
B300 | T500 | total | |||||||
sales | 1200000 | 491400 | 1691400 | ||||||
less:Expenses | |||||||||
direct materials | 400100 | 163000 | 563100 | ||||||
direct labor | 120500 | 42800 | 163300 | ||||||
manufacturing OH applied @3.09 | 376877 | 133862 | 510739 | ||||||
total manufacturing cost | 897477 | 339662 | 1237139 | ||||||
product margin | 302523 | 151738 | 454261 | answer | |||||
2) | ABC activity based | ||||||||
Activity rates | |||||||||
(a) | (b) | c=a/b | |||||||
Activity cost pools | total cost | total | Activity rate | ||||||
activity | |||||||||
machining | 200,299 | 152,900 | 1.31 | per machine hour | |||||
Setups | 149,240 | 364 | 410 | per setup hour | |||||
product sustaining | 100,800 | 2 | 50400 | per product | |||||
product margin under ABC accounting | |||||||||
B300 | T500 | total | |||||||
sales | 1200000 | 491400 | 1691400 | ||||||
less:Expenses | |||||||||
direct materials | 400100 | 163000 | 563100 | ||||||
direct labor | 120500 | 42800 | 163300 | ||||||
Advertising expense | 56,000 | 104,000 | 160000 | ||||||
manufacturing overhead assigned | |||||||||
machining | 118686 | 81613 | 200299 | ||||||
Setups | 30340 | 118900 | 149240 | ||||||
product sustaining | 50400 | 50400 | 100800 | ||||||
total cost | 776,026 | 560,713 | 1336739 | ||||||
product margin | 423974 | -69313 | 354661 | ||||||
Traditional cost system | B 300 | T -500 | |||||||
3) | % of total | % of total | Total | ||||||
amount | amount | amount | amount | amount | |||||
Traditional cost system | |||||||||
Direct materials | 400100 | 71.1% | 163000 | 28.9% | 563100 | ||||
direct labor | 120500 | 73.8% | 42800 | 26.2% | 163300 | ||||
manufacturing overhead | 376877 | 73.8% | 133862 | 26.2% | 510739 | ||||
total cost assigned to products | 1237139 | ||||||||
selling & administrative cost | 650,000 | ||||||||
total cost. | 1887139 | ||||||||
B 300 | T -500 | ||||||||
% of total | % of total | Total | |||||||
amount | amount | amount | amount | amount | |||||
ABC based costing system | |||||||||
Direct costs | |||||||||
direct materials | 400100 | 71.1% | 163000 | 28.9% | 563100 | ||||
direct labor | 120500 | 73.8% | 42800 | 26.2% | 163300 | ||||
Advertising expense | 56,000 | 35.0% | 104,000 | 65.0% | 160000 | ||||
Indirect costs: | |||||||||
machining | 118686 | 59.3% | 81613 | 40.7% | 200299 | ||||
Setups | 30340 | 20.3% | 118900 | 79.7% | 149240 | ||||
product sustaining | 50400 | 50.0% | 50400 | 50.0% | 100800 | ||||
total cost assigned to products | 776026 | 560713 | 1336739 | ||||||
cost not assigned to products | |||||||||
Selling & administrative expense | 490,000 | ||||||||
other | 60,400 | ||||||||
total cost. | 1887139 |
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts—the B300 and the T500. An absorption...
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts—the B300 and the T500. An absorption costing income statement for the most recent period is shown: $ Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss 1,763,400 1,219,880 543, 520 560,000 (16,480) $ Hi-Tek produced and sold 60,200 units of B300 at a price of $21 per unit and 12,800 units of T500 at a price of $39 per unit....
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts-the B300 and the T500. An absorption costing income statement for the most recent period is shown: Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss $ 1,705, 200 1, 226, 129 479,071 600,000 $ (120,929) Hi-Tek produced and sold 60,300 units of B300 at a price of $20 per unit and 12,800 units of T500 at a price of $39...
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts--the B300 and the T500. An absorption costing income statement for the most recent period is shown: Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss $ 1,772,400 1, 248,128 524,272 610,000 $ (85,728) Hi-Tek produced and sold 60,400 units of B300 at a price of $21 per unit and 12,600 units of T500 at a price of $40 per unit....
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts-the B300 and the T500. An absorption costing income statement for the most recent period is shown: $ Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss 1,697,400 1,214,028 483,372 600,000 (116,628) $ Hi-Tek produced and sold 60,300 units of B300 at a price of $20 per unit and 12,600 units of T500 at a price of $39 per unit. The...
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts—the B300 and the T500. An absorption costing income statement for the most recent period is shown: $ Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss 1,639,000 1,213,070 425,930 600,000 (174,070) $ Hi-Tek produced and sold 60,400 units of B300 at a price of $19 per unit and 12,600 units of T500 at a price of $39 per unit. The...
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts—the B300 and the T500. An absorption costing income statement for the most recent period is shown: Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss $ 1,710,000 1,228,926 481,074 640,000 $ (158,926) Hi-Tek produced and sold 60,100 units of B300 at a price of $20 per unit and 12,700 units of T500 at a price of $40 per unit. The...
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts—the B300 and the T500. An absorption costing income statement for the most recent period is shown: Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss $ 1,716,000 1,227,300 488,700 590,000 $ (101,300) Hi-Tek produced and sold 60,200 units of B300 at a price of $20 per unit and 12,800 units of T500 at a price of $40 per unit. The...
Hi-Tek Manufacturing, Inc., makes two types of industrial component parts-the B300 and the T500. An absorption costing income statement for the most recent period is shown: Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross margin Selling and administrative expenses Net operating loss $ 1,710,000 1, 207, 180 502,820 580,000 $ (77, 180) Hi-Tek produced and sold 60,300 units of B300 at a price of $20 per unit and 12,600 units of T500 at a price of $40...
Hi-Tek Manufacturing, Inc., makes two types of Industrial component parts—the B300 and the T500. An absorption costing Income statement for the most recent period is shown: Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross Margin Selling and administrative expenses Net operating loss $ 1,784, eee 1,249,503 454, 497 568,eee $ (185,583) Hi-Tek produced and sold 60.000 units of B300 at a price of $20 per unit and 12.600 units of T500 at a price of $40 per...
Hi-Tek Manufacturing, Inc., makes two types of Industrial component parts—the B300 and the T500. An absorption costing Income statement for the most recent period is shown: Hi-Tek Manufacturing Inc. Income Statement Sales Cost of goods sold Gross Margin Selling and administrative expenses Net operating loss $ 1,784, eee 1,249,503 454, 497 568,eee $ (185,583) Hi-Tek produced and sold 60.000 units of B300 at a price of $20 per unit and 12.600 units of T500 at a price of $40 per...