Question

Rais attempt Support O3 Not complete Maced out of 35.00 Trug quiten Traditional Product Costing Versus Activity-Based Costing Assume that Panasonic Company has determined its estimated total manufacturing overhead cost for one of its plants to be $204,000, consisting of the following activity cost pools for the current month Activity Centers Activity Costs Cost Drivers Activity Level 545,000 Setup hours Matanding 15.000 Number of moves 120.000 Assembly hours Martenance 2000 Martenance hours 1.200 Total 1204000 Total direct labor hours used during the month were 8,000. Panasonic produces many different electronic products, including the following two products produced during the current month Model X301 Model 2015 Units produced Direct materials costs Direct labor costs Direct labor hours Setup hours Materials moves Assembly hour Maintenance hours 1,000 $15.000 $12.500 500 50 25 800 $15.000 $12.500 500 100 50 10 43

Answer 1

Solution :

(a)

Direct Labor Rate per Hour    = Total Estimated OH / Total Direct Labor Hours

                                          = $ 204,000 / 8,000

OH Rate per DLH                 = $ 25.50 per DLH.

	X301	Z205
Direct Material	$ 15,000	$ 15,000
Direct Labor	$ 12,500	$ 12,500
OH Cost (DLH * $ 25.50)	$ 12,750	$ 12,750
Total Cost	$ 40,250	$ 40,250
Units	1,000	1,000
Per Unit Cost	$ 40.25	$ 40.25

(b)

Activity	Activity OH	Cost Drivers	Activity Rate
Assembly Setups	$ 45,000	1,500 Setup Hours	$ 30 per Setup
Material Handling	$ 15,0000	300 Moves	$ 50 per Move
Assembly	$ 120,000	12,000 Assembly Hours	$ 10 per Assembly Hours
Maintenance	$ 24,000	1,200 Manitenance Hours	$ 20 per Maintenance Hours

	X301	Z205
Direct Material	$ 15,000	$ 15,000
Direct Labor	$ 12,500	$ 12,500
Manufacturing OH Cost
Assembly Setup (Setup Hours * $ 30)	$ 1,500	$ 3,000
Material Handling (Number of Moves * $ 50)	$ 1,250	$ 2,500
Assembly (Assembly Hours * $ 10)	$ 8,000	$ 8,000
Maintenance (Maintenance Hours * $ 20)	$ 200	$ 200
Total Cost	$ 38,450	$ 41,200
Units	1,000	1,000
Per Unit Cost	$ 38.45	$ 41.20

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