Odyssey Inc. has a total of $945,000 in production overhead costs. The company’s products and related...
Odyssey Inc. has a total of $945,000 in production overhead costs. The company’s products and related statistics follow.
| Product A | Product B | |
|---|---|---|
| Direct material in pounds | 139,500 | 190,500 |
| Direct labor hours | 30,000 | 37,500 |
| Machine hours | 52,500 | 22,500 |
| Number of setups | 430 | 860 |
| Number of units produced | 15,000 | 7,500 |
Additional data: The 330,000 pounds of material were purchased
for $217,800. One direct labor hours costs $5.
a. Assume that Odyssey Inc. uses direct labor hours to
apply overhead to products. Determine the total cost for each
product and the cost per unit.
Note: Round your final answers to two decimal
places (i.e. round $4.355 to $4.36).
| Product A | Product B | |
|---|---|---|
| Total cost | ||
| Total cost per unit |
b. Assume that Odyssey Inc. uses machine hours to apply
overhead to products. Determine the total cost for each product and
the cost per unit.
Note: Round your final answers to two decimal
places (i.e. round $4.355 to $4.36).
| Product A | Product B | |
|---|---|---|
| Total cost | ||
| Total cost per unit |
c. Assume that Odyssey Inc. uses the following activity centers, cost drivers, and costs to apply overhead to products:
| Cost Pool | Cost Driver | Cost |
|---|---|---|
| Utilities | # of machine hours | $300,000 |
| Setup | # of setups | 77,400 |
| Material handling | # of pounds of material | 567,600 |
Determine the total cost for each product and the cost per
unit.
Note: Round your final answers to two decimal
places (i.e. round $4.355 to $4.36).
| Product A | Product B | |
|---|---|---|
| Total cost | ||
| Total cost per unit |
Homework Answers
(a)
| Product A | Product B | |
| Total Cost | $ 662,070 | $ 838,230 |
| Total cost per unit | $ 44.14 | $ 111.76 |
Explanations :-
| Product A | Product B | |
| Direct materials | ||
| (139500 * $0.66) | $ 92,070 | |
| (190500 * $0.66) | $ 125,730 | |
| Direct labor | ||
| (30000 * $5) | $ 150,000 | |
| (37500 * $5) | $ 187,500 | |
| Overhead | ||
| (30000 *$14) | $ 420,000 | |
| (37500 * $14) | $ 525,000 | |
| Total Cost | $ 662,070 | $ 838,230 |
| ÷ No of units | 15000 | 7500 |
| Total cost per unit | $ 44.14 | $ 111.76 |
| Overhead Rate | ||
| Total Overhead | $ 945,000 | |
| ÷ Direct Labor Hours | 67500 | |
| Overhead Rate | $ 14 |
(b)
| Product A | Product B | |
| Total Cost | $ 903,570 | $ 596,730 |
| Total cost per unit | $ 60.24 | $ 79.56 |
Explanations :-
| Product A | Product B | |
| Direct materials | ||
| (139500 * $0.66) | $ 92,070 | |
| (190500 * $0.66) | $ 125,730 | |
| Direct labor | ||
| (30000 * $5) | $ 150,000 | |
| (37500 * $5) | $ 187,500 | |
| Overhead | ||
| (52500 *$12.60) | $ 661,500 | |
| (22500 * $12.60) | $ 283,500 | |
| Total Cost | $ 903,570 | $ 596,730 |
| ÷ No of units | 15000 | 7500 |
| Total cost per unit | $ 60.24 | $ 79.56 |
| Overhead Rate | ||
| Total Overhead | $ 945,000 | |
| ÷ Machine Hours | 75000 | |
| Overhead Rate | $ 12.60 |
(c)
| Product A | Product B | |
| Total Cost | $ 717,810 | $ 782,490 |
| Total cost per unit | $ 47.85 | $ 104.33 |
Explanations :-
| Product A | Product B | |
| Direct materials | ||
| (139500 * $0.66) | $ 92,070 | |
| (190500 * $0.66) | $ 125,730 | |
| Direct labor | ||
| (30000 * $5) | $ 150,000 | |
| (37500 * $5) | $ 187,500 | |
| Overhead | $ 475,740 | $ 469,260 |
| Total Cost | $ 717,810 | $ 782,490 |
| ÷ No of units | 15000 | 7500 |
| Total cost per unit | $ 47.85 | $ 104.33 |
| Cost Pool | Cost (A) | Cost Driver (B) | Rate (C=A/B) | Product A Driver (D) | Product B Driver (E) | Product A Cost (CXD) | Product B Cost (CXE) |
| Utilities | $300,000 | 75000 | $4.00 | 52500 | 22500 | $210,000 | $90,000 |
| Setup | $77,400 | 1290 | $60.00 | 430 | 860 | $25,800 | $51,600 |
| Material handling | $567,600 | 330000 | $1.72 | 139500 | 190500 | $239,940 | $327,660 |
| Total Overhead | $ 475,740 | $ 469,260 |
Add Answer to:
Odyssey Inc. has a total of $945,000 in production overhead
costs. The company’s products and related...
Odyssey Inc. has a total of $945,000 in production overhead costs. The company’s products and related...
Odyssey Inc. has a total of $945,000 in production overhead costs. The company’s products and related statistics follow. Product A Product B Direct material in pounds 139,500 190,500 Direct labor hours 30,000 37,500 Machine hours 52,500 22,500 Number of setups 430 860 Number of units produced 15,000 7,500 Additional data: The 330,000 pounds of material were purchased for $217,800. One direct labor hours costs $5. a. Assume that Odyssey Inc. uses direct labor hours to apply overhead to products. Determine...
ABC Odyssey Inc. has a total of $1,890,000 in production overhead costs. The company's products and...
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Orange, Inc. has identified the following cost drivers for its expected overhead costs for the year:...
Orange, Inc. has identified the following cost drivers for its expected overhead costs for the year: Expected Quantity 250 1,500 2,000 4,000 Expected Cost Overhead Item Cost Driver $ 59,500 Number of setups Setup costs Ordering costs Maintenance Power Total Overhead 49,000 Number of orders 138,000 Machine hours 29,500 Kilowatt hours $ 276,000 Total direct labor hours budgeted - 2,000 hours The following actual data applies to one of the products completed during the year: Product X Direct materials Direct...
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A. Assuming use of direct-labor hours to apply overhead to production, compute the unit manufacturing costs...
A. Assuming use of
direct-labor hours to apply overhead to production, compute the
unit manufacturing costs of the Standard and Enhanced products if
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Manufacturing cost per unit: Standard $ ? and Enhanced $ ?
B. Assuming use of activity-based costing, compute the unit
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Manufacturing cost per unit: Standard $ ? and Enhanced $ ?
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Bonita Inc. has identified the following overhead costs and cost drivers for next year. Overhead Item...
Bonita Inc. has identified the following overhead costs and cost
drivers for next year.
Overhead
Item
Expected
Cost
Cost
Driver
Expected
Actual Transactions
Setup costs
$87,912
No. of setups
396
Ordering costs
46,800
No. of orders
3,900
Maintenance costs
125,000
Machine hours
25,000
Power
26,495
Kilowatt hours
75,700
The following are two of the jobs completed during the
year:
Job 700
Job 701
Direct materials
$1,200
$600
Direct labour
$890
$420
Units completed
250
100
Direct labour hours
40
20...
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A. Assuming use of
direct-labor hours to apply overhead to production, compute the
unit manufacturing costs of the Standard and Enhanced products if
the expected manufacturing volume is attained.
Manufacturing cost per unit: Standard $ ? and Enhanced $ ?
B. Assuming use of activity-based costing, compute the unit
manufacturing costs of the Standard and Enhanced products if the
expected manufacturing volume is attained.
Manufacturing cost per unit: Standard $ ? and Enhanced $ ?
C. By using direct-labor hours...
Bonita Inc. has identified the following overhead costs and cost
drivers for next year.
Overhead
Item
Expected
Cost
Cost
Driver
Expected
Actual Transactions
Setup costs
$87,912
No. of setups
396
Ordering costs
46,800
No. of orders
3,900
Maintenance costs
125,000
Machine hours
25,000
Power
26,495
Kilowatt hours
75,700
The following are two of the jobs completed during the
year:
Job 700
Job 701
Direct materials
$1,200
$600
Direct labour
$890
$420
Units completed
250
100
Direct labour hours
40
20...
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