Homework Answers
1 Answer: Option c) They are too low
Explanation:
If the operations run on less than the full capacity the cost driver rates are too low.
An activity cost driver is a component of a business process. An activity cost driver influences the costs of labor, maintenance other variable costs.
Cost drivers are essential in a branch of managerial accounting that allocates the indirect overheads.
.
2 Answer: Option b) The proportion of each activity consumed by a product.
Explanation:
Consumption ratio is defined as the proportion of each activity consumed by a product.
The consumption ratio is between the quantity of a flavoring material consumed as an ingredient of a basic product and the quantity of the same material consumed as a additive by the same population over the same period.
.
3 Answer: Product-level activity
Explanation:
If activity based costing is used, modifications made by engineering to the product design of several products would be classified as Product-level activity.
These activities relate to specific products must be carried out and how many units of product are produced or sold.
These activities includes like designing a product, advertising a product, and maintaining a product manager and staff are all product-level activities.
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VODYVIVILE If operations run on less than full capacity, what is the result on cost driver...
Required information Gable Company uses three activity cost pools. Each pool has a cost driver. Information...
Required information Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $183,300 Number of machine hours 47,725 Number of design hours 71,150 Number of batches Estimated Cost Driver 61,100 5,750 500 Required: 1. Compute the activity rate for each activity. 2. Classify each activity as facility, product, batch, or unit level. Complete this question by entering your...
Which of the following statements is true regarding the expected global consumption ratio? a.It is calculated...
Which of the following statements is true regarding the expected global consumption ratio? a.It is calculated by dividing budgeted annual overhead by budgeted annual driver level. b.It is calculated by dividing the cost of resources supplied by the practical capacity of resources supplied. c.It is the proportion of the total activity costs consumed by a given product. d.It is the proportion of non-unit-related overhead costs to total overhead costs.
Required information Gable Company uses three activity cost pools. Each pool has a cost driver. Information...
Required information Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $312,000 Number of machine hours 73,600 Number of design hours 71,600 Number of batches Estimated Cost Driver 80,000 8,000 500 Required: 1. Compute the activity rate for each activity. 2. Classify each activity as facility, product, batch, or unit level. Complete this question by entering your...
Rocoe Company produces a variety of garden tools in a highly automated manufacturing facility. The costs and cost driver...
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Activity-Based Costing Slack Corporation has the following predicted indirect costs and cost drivers for 2016 for...
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Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable...
Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $171,100 Number of machine hours 45,100 Number of design hours 66,123 Number of batches Estimated Cost Driver 59,000 5,500 465 Required: 1. Compute the activity rate for each activity. 2. Classify each activity as facility, product, batch, or unit level. Complete this question by entering your answers in...
Question 9 Match the following statements to the appropriate terms. Allocates overhead to multiple activity cost...
Question 9 Match the following statements to the appropriate terms. Allocates overhead to multiple activity cost pools, then assigns the activity cost pools to products. An activity that has a direct cause-effect relationship with the resources consumed. Increases the worth of a product or service to customers. Should be eliminated or reduced. Plant management. Engineering changes. Equipment setups. Assembling. Primary objective is to eliminate all manufacturing inventories. Used to initiate manufacturing under JIT processing. Activity-based costing Product-level activity Unit-level activity...
! Required information Gable Company uses three activity cost pools. Each pool has a cost driver....
! Required information Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $416,700 Number of machine hours 93,100 Number of design hours 73,338 Number of batches Estimated Cost Driver 92,600 9,500 510 Required: 1. Compute the activity rate for each activity. 2. Classify each activity as facility, product, batch, or unit level. Complete this question by entering...
Bernadette Inc. makes several products and uses one cost driver (direct labour hours) to assign overhead...
Bernadette Inc. makes several products and uses one cost driver (direct labour hours) to assign overhead to the products. Bernadette has started to wonder whether the use of activity based costing (ABC) would be more appropriate. To start, Bernadette would like to investigate what the costing would look like for one product (Product A) using ABC. Details are below. Current Unit Information of Product A (using direct labour hours as the overhead cost driver) Selling Price $23 Direct Materials $10 Direct Labour 6 Overhead 3...
Activity Expected Cost Activity Driver Activity Capacity Setting up equipment $132,000 Number of setups...
Activity Expected Cost Activity Driver Activity Capacity Setting up equipment $132,000 Number of setups 120 Ordering materials 27,600 Number of orders 1,200 Machining 118,300 Machine hours 9,100 Receiving 34,320 Receiving hours 1,320 Silven produces two models of cell phones with the following expected activity demands: Model X Model Y Units completed 5,900 11,800 Number of setups 80 40 Number of orders 400 800 Machine hours 5,200 3,900 Receiving hours 440 880 1. Determine...
Required information Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $183,300 Number of machine hours 47,725 Number of design hours 71,150 Number of batches Estimated Cost Driver 61,100 5,750 500 Required: 1. Compute the activity rate for each activity. 2. Classify each activity as facility, product, batch, or unit level. Complete this question by entering your...
Required information Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $312,000 Number of machine hours 73,600 Number of design hours 71,600 Number of batches Estimated Cost Driver 80,000 8,000 500 Required: 1. Compute the activity rate for each activity. 2. Classify each activity as facility, product, batch, or unit level. Complete this question by entering your...
Activity-Based Costing Slack Corporation has the following predicted indirect costs and cost drivers for 2016 for the given activity cost pools Fabrication Department Finishing Department Cost Driver Maintenance Materials handling Machine setups Inspections $65,000 30,000 70,000 $55,000 Machine hours 15,000 Material moves 5,000 Machine setups 25,000 Inspection hours 165,000 $100,000 The following activity predictions were also made for the year Machine hours Material moves Machine setups Inspection hours Fabrication Department Finishing Department 5,000 1,500 50 1,000 10,000 3,000 700 It...
Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $171,100 Number of machine hours 45,100 Number of design hours 66,123 Number of batches Estimated Cost Driver 59,000 5,500 465 Required: 1. Compute the activity rate for each activity. 2. Classify each activity as facility, product, batch, or unit level. Complete this question by entering your answers in...
Question 9 Match the following statements to the appropriate terms. Allocates overhead to multiple activity cost pools, then assigns the activity cost pools to products. An activity that has a direct cause-effect relationship with the resources consumed. Increases the worth of a product or service to customers. Should be eliminated or reduced. Plant management. Engineering changes. Equipment setups. Assembling. Primary objective is to eliminate all manufacturing inventories. Used to initiate manufacturing under JIT processing. Activity-based costing Product-level activity Unit-level activity...
! Required information Gable Company uses three activity cost pools. Each pool has a cost driver. Information for Gable Company follows: Activity Cost Pools Machining Designing costs Setup costs Total Cost of Pool Cost Driver $416,700 Number of machine hours 93,100 Number of design hours 73,338 Number of batches Estimated Cost Driver 92,600 9,500 510 Required: 1. Compute the activity rate for each activity. 2. Classify each activity as facility, product, batch, or unit level. Complete this question by entering...
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