Question:earch this book Q Read Study AE 40. Activity-Based Costing Versus Traditional Approach. Carson Company produces...
Question
earch this book Q Read Study AE 40. Activity-Based Costing Versus Traditional Approach. Carson Company produces...
earch this book Q Read Study AE 40. Activity-Based Costing Versus Traditional Approach. Carson Company produces a regular computer monitor that sells for $175 and a premium computer monitor that sells for $300. Last year, total overhead costs of $3,675,000 were allocated based on direct labor hours. A total of 63,000 direct labor hours were required last year to build 36,000 regular monitors (1.75 hours per unit), and 42,000 direct labor hours were required to build 12,000 premium monitors (3.50 hours per unit). Total direct labor and direct materials costs for last year were as follows: Regular Monitor Premium Monitor Direct materials $1,908,000 $ 900,000 Direct labor $1,728,000 $1,200,000 The management of Carson Company would like to use activity-based costing to allocate overhead rather than one plantwide rate based on direct labor hours. The following estimates are for the activities and related cost drivers identified as having the greatest impact on overhead costs. Estimated cost Driver Activity Total Estimated Activity Cost Driver Overhead Costs Regular Premium Purchase orders Number of purchase orders $1,200,000 400 600 Production setups Number of setups 1,125,000 120 30 Quality inspections Inspection hours 750,000 3,600 8,400 Packaging and shipping Number of units shipped $ 600,000 36,000 12,000 Total 53,675,000 1,000 150 12,000 48.000 Required: a. Calculate the direct materials cost per unit and direct labor cost per unit for each product. b. 1. Using the plantwide allocation method, calculate the predetermined overhead rate and determine the overhead cost per unit allocated to the regular and premium monitors. Ilsing the plantacide allocation method calculate the noduct cost per unit for the regular and DE FLASHCARDS V QUIZ REVIOUS
41. Activity-Based Costing Versus Traditional Approach, Activity-Based Management. Fine Finishing, Inc, produces a wood desk that sells for $500 and a wood table that sells for $900. Last year, total overhead costs of $6,000,000 were allocated based on direct labor costs. Direct labor costs totaled $2,000,000 last year, and the company produced 15,000 desks and 5,000 tables. Total direct labor and direct materials costs by product for last year were as follows: Desk Table Direct materials $1,575,000 $950,000 Direct labor...
Problem 2 (Supplemental Problem #2) – Activity-based costing
versus traditional costing Lovelace Company produces only two
products: reading glasses and sunglasses. The company uses a normal
cost system and overhead costs are currently allocated using a
plant-wide overhead rate based on direct labor hours. Outside cost
consultants have recommended that the company use activity-based
costing to charge overhead to products. The company expects to
produce 4,000 reading glasses and 8,000 sunglasses this year. Each
pair of reading glasses requires two...
$ Additional ABC Problems 1. Activity-Based versus Traditional Costing Maglie Company manufactures two video game consoles: handheld and home. The handheld consoles are smaller and less expensive than the home consoles. Management believes that the accounting system is not accurately allocating costs to products and has asked you to investigate if there is a cost allocation problem. You find that manufacturing overhead costs are currently assigned to products based on their direct labor costs. For your investigation, you have data...
I am just confused about this
last part, the "activity based costing"
Calculate the cost of Job 358 using activity-based costing. Job Cost Record JOB 358 Manufacturing Costs Direct labor Direct materials Engineering costs Maintenance costs Manufacturing overhead allocated Waste disposal costs remaining C ar in the input fields and then click Check Answer. Clear All Total estimated manufacturing costs 1 Estimated total machine hours Plantwide mfg. overhead rate $ 140 1,260,000 9,000 Calculate the cost of Job 358. Job...
Quality Furniture,Inc., produces a wood desk that sells for $500
and a wood table that sells for $900. Last year, total overhead
costs of $6,000,000 were allocated based on direct labor costs.
Direct labor costs totaled $2,000,000 last year, and Quality
Furniture produced 15,000 desks and 5,000 tables. Total direct
labor and direct materials costs by product for the last year were
as follows:
Desk
Table
Total
Direct materials
1,575,000
950,000
Direct labor
1,200,000
800,000
2,000,000
Sales price
500
900...
Plantwide versus Departmental Rates, Product-Costing Accuracy: Activity-Based Costing Ramsey Company produces speakers (Model A and Model B). Both products pass through two producing departments, Model A's production is much more labor-intensive than that of Model B. Model B is also the more popular of the two speakers. The following data has been gathered for the two products Product Data Product Data Model A Model B Units produced per year 10,000 100,000 Prime costs $150,000 $1,500,000 Direct labor hours 140,000 300,000...
Pro blem 2 (Supplemental Problem #2)-Activity-based costing versus traditional costing sunglasses. The company uses a normal cos based on direct labor hours Lovelace Company produces only two products: reading glasses and sung system and overhead costs are currently allocated using a plant-wide overhead rate products. Itants have recommended that the company use activity-based costing to charge overhead to he company expects to produce 4,000 reading glasses and 8,000 sunglasses this year. Each pair of reading glasses requires two direct labor...
Traditional Product Costing versus Activity-Based
Costing
Ridgeland Inc. makes backpacks for large sporting goods chains that
are sold under the customers' store brand names. The Accounting
Department has identified the following overhead costs and cost
drivers for next year:
Overhead Item
Expected Costs
Cost Driver
Maximum Quantity
Setup costs
$734,400
Number of setups
7,200
Ordering costs
195,000
Number of orders
65,000
Maintenance
1,380,000
Number of machine hours
80,000
Power
132,000
Number of kilowatt hours
440,000
Total predicted direct labor hours...
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 $1,272,800 consisting of the following activity cost pools for the current month: Activity Centers Activity Costs Cost Drivers Activity Level Assembly setups $ 264,000 Setup hours 2.000 Materials handing 129,600 Number of moves 600 Assembly 720,000 Assembly hours 18,000 Maintenance 159,200 Maintenance hours 1.990 Total $1,272,800 Total direct labor hours used during the month were...
EXPLAIN STEP BY STEP
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 $1,591,000,
consisting of the following activity cost pools for the current
month:
Activity Centers
Activity Costs
Cost Drivers
Activity Level
Assembly setups
$ 330,000
Setup hours
2,000
Materials handing
162,000
Number of moves
600
Assembly
900,000
Assembly hours
18,000
Maintenance
199,000
Maintenance hours
1,990
Total
$1,591,000
Total direct labor hours used...
41. Activity-Based Costing Versus Traditional Approach, Activity-Based Management. Fine Finishing, Inc, produces a wood desk that sells for $500 and a wood table that sells for $900. Last year, total overhead costs of $6,000,000 were allocated based on direct labor costs. Direct labor costs totaled $2,000,000 last year, and the company produced 15,000 desks and 5,000 tables. Total direct labor and direct materials costs by product for last year were as follows: Desk Table Direct materials $1,575,000 $950,000 Direct labor...
$ Additional ABC Problems 1. Activity-Based versus Traditional Costing Maglie Company manufactures two video game consoles: handheld and home. The handheld consoles are smaller and less expensive than the home consoles. Management believes that the accounting system is not accurately allocating costs to products and has asked you to investigate if there is a cost allocation problem. You find that manufacturing overhead costs are currently assigned to products based on their direct labor costs. For your investigation, you have data...
I am just confused about this
last part, the "activity based costing"
Calculate the cost of Job 358 using activity-based costing. Job Cost Record JOB 358 Manufacturing Costs Direct labor Direct materials Engineering costs Maintenance costs Manufacturing overhead allocated Waste disposal costs remaining C ar in the input fields and then click Check Answer. Clear All Total estimated manufacturing costs 1 Estimated total machine hours Plantwide mfg. overhead rate $ 140 1,260,000 9,000 Calculate the cost of Job 358. Job...
Quality Furniture,Inc., produces a wood desk that sells for $500
and a wood table that sells for $900. Last year, total overhead
costs of $6,000,000 were allocated based on direct labor costs.
Direct labor costs totaled $2,000,000 last year, and Quality
Furniture produced 15,000 desks and 5,000 tables. Total direct
labor and direct materials costs by product for the last year were
as follows:
Desk
Table
Total
Direct materials
1,575,000
950,000
Direct labor
1,200,000
800,000
2,000,000
Sales price
500
900...
Plantwide versus Departmental Rates, Product-Costing Accuracy: Activity-Based Costing Ramsey Company produces speakers (Model A and Model B). Both products pass through two producing departments, Model A's production is much more labor-intensive than that of Model B. Model B is also the more popular of the two speakers. The following data has been gathered for the two products Product Data Product Data Model A Model B Units produced per year 10,000 100,000 Prime costs $150,000 $1,500,000 Direct labor hours 140,000 300,000...
Pro blem 2 (Supplemental Problem #2)-Activity-based costing versus traditional costing sunglasses. The company uses a normal cos based on direct labor hours Lovelace Company produces only two products: reading glasses and sung system and overhead costs are currently allocated using a plant-wide overhead rate products. Itants have recommended that the company use activity-based costing to charge overhead to he company expects to produce 4,000 reading glasses and 8,000 sunglasses this year. Each pair of reading glasses requires two direct labor...
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 $1,272,800 consisting of the following activity cost pools for the current month: Activity Centers Activity Costs Cost Drivers Activity Level Assembly setups $ 264,000 Setup hours 2.000 Materials handing 129,600 Number of moves 600 Assembly 720,000 Assembly hours 18,000 Maintenance 159,200 Maintenance hours 1.990 Total $1,272,800 Total direct labor hours used during the month were...