Question

Question 14

Required information [The following information applies to the questions displayed below.] Sara's Salsa Company produces its condiments in two types: Extra Fine for restaurant customers and Family Style for home use. Salsa is prepared in department 1 and packaged in department 2. The activities, overhead costs, and drivers associated with these two manufacturing processes and the company's production support activities follow. Process Department 1 Activity Mixing Cooking Product testing Driver Machine hours Machine hours Batches Quantity 1,700 1,700 550 Department 2 Machine calibration Labeling Defects Overhead cost $ 5,300 10,000 113,300 $ 128,600 $ 290,000 16,000 10,000 $316,000 $ 98,000 34,000 73,000 $ 205,000 Production runs Cases of output Cases of output 800 130,000 130,000 Support Recipe formulation Heat, lights, and water Materials handling Focus groups Machine hours Container types 50 1,700 10

Answer 1

B Rate 4. W.N 3 Cost Ananlysis in Department 2 Particulars Machine Caliberation Labeling 29 Defects 362.50 Overhead cost Cost Driver Quantity 2,90,000.00 Production Runs 800.00 16,000.00 Cases of out put 1,30,000.00 10,000.00 Cases of out put 1,30,000.00 0.12 0.08 31 W.N4 Cost Ananlysis in Support Process Particulars Overhead cost Cost Driver Receipe Formulation 98,000.00 Focus groups Heat Light and water 34,000.00 Machine hours Material Handling 73,000.00 Container Types Quantity Rate 50.00 1,960.00 1,700.00 10.00 7,300.00 38 W.N5 29 Calculation of Cost Per Unit in Department 1 Extra Fine Family Style Mixing Cost 42 a Machine Hours per unit 0.02 0.01 W.N1 Mixing Cost Per machine hour 3.12 3.12 W.N 2 24c Mixing Cost per Unit 0.03 a xb 45 COSHOT ON MI A1 46 O MIDUAL CAMERA 0.02 0.01 W.N1 Sheet19

60 59 W.N 6 Calculation of Cost Per Unit in Department 2 Costs Extra Fine Family Style Machine Caliberation 63 la Units 5 per production run 100.00 196.15 W.N1 Cost per Production Run 362.50 362.50 W.N3 65 C Cost per Unit 3.63 1.85 b/a 66 Labeling Cost per Case/unit 0.12 W.N3 68 Defects 69 e Cost per case/unit 0.08 0.08 W.N3 Total Cost per unit 2.06 72 W.N7 Calculation of Cost Per Unit in Support Process 74 Costs Extra Fine Family Style Notes 75 Receipe Formulation 76 a Unit per focus group 1,400.00 3,400.00 W.N1 Cost per Focus Group 1,960.00 1,960.00 W.N4 Cost per unit 0.58 b/a 79 Heat Light and Water 80 d Mörbironmr arr unit 0.01 W.N1 O MI DUAL CAMERA our 20.00 20.00 W.N4 Sheet19 780

B 26 d 88 f Mbing Cost Machine Hours per unit 0.01 W.N1 Mixing Cost Per machine hour 3.12 W.N2 Mixing Cost per Unit 0.03 axb Cooking Cost Machine Hours per unit 0.02 0.01 W.N1 Cooking Cost Per machine hour 5.88 5.88 W.N2 Cooking Cost per unit 0.06 dxf Product Testing Cost Unit per batch 100.0 377.78 W.N1 Cost Per Batch 206.00 206.00 W.N2 Cost per unit 0.55 h/g Summary of cost incurred in Department 1 Costs Extra Fine Family Style Mixing Cost 0.07 0.03 Cooking Cost 0.06 Product Testing Cost 2.06 0.55 Total 2.27 50 g 51 h 52 i 53 54 55 56 59 W.N 6 60 Calculation of Cost Per Unit in Department 2 Costa SHOT ON MI A1 Extra Fine Family Style MI DUAL CAMERAion 63 a Units per production run 100.00 196.15 W.N1

1,960.00 1.40 1,960.00 W.N4 0.58 b/a 0.01 Y.N1 20.00 W.N4 0.21 dxe 0.46 3 Cost per Focus Group Cost per unit 79 Heat Light and Water 80. d. Machine hour per unit 81 e Cost per Machine hour Cost per unit 83 Material Handling Unit per container 85 h Cost per container 86 i Cost per unit 87 88 Total Cost per unit in Support process 89 4,000.00 7,300.00 34,000.00 W.N1 7,300.00 W.N4 0.21 h/g 3.69 1.00 C++i Calculation of Gross Profit per case 91 Particulars Extra Fine Family Style Notes 92 a Market Price 13.00 7.00 Given Less Costs Cost incurred in Department 1 0.64 W.N5 Cost incurred in Department 2 2.05 W.N6 96 d Cost incurred in Support Process 1.00 W.N7 Total cos SHOT ON MI A1 3.68 b+c+d MI DUAL CAMERA 3.32 af 95 c

b C W.N1 Analysis of given Data Particulars Extra Fine Units Produced in cases 28,000.00 Batches 280.00 Unit per batch 100.00 Machine Hours 650.00 e Machine hour per unit If Focus groups 20.00 Unit per focusgroup 1,400.00 Containers Unit per container 4,000.00 li Production Runs 280.00 k Units per production run 100.00 Family Style 1,02,000.00 270.00 377.78 a/b 1,050.00 0.01 d/a 30.00 3,400.00 a/g. 3.00 34,000.00 a/h 520.00 196.15 aj Rate W.N 2 Cost Ananlysis in Department 1 Particulars Mixing Cooking Product Testing SHOT ON MI A1 MI DUAL CAMERA Sheet19 3.12 Overhead cost Cost Driver 5,300.00 Machine Hours 10,000.00 Machine hours 1,13,300.00 Batches Quantity 1,700.00 1,700.00 550.00 5.88 206.00