Question

Radakovich Corporation has provided the following data from its activity-based costing system:

Activity Cost Pools	Total Cost			Total Activity
Assembly	$	1,443,140		59,000	machine-hours
Processing orders	$	80,905		2,750	orders
Inspection	$	145,733		1,910	inspection-hours

The company makes 890 units of product F60N a year, requiring a total of 2,070 machine-hours, 41 orders, and 35 inspection-hours per year. The product's direct materials cost is $56.46 per unit and its direct labor cost is $22.67 per unit. The product sells for $146.50 per unit.

According to the activity-based costing system, the product margin for product F60N is: (Round your intermediate calculations to 2 decimal places.)

$8,120.88

$6,656.60

$59,959.30

$5,450.38

Activity rates from Mcelderry Corporation's activity-based costing system are listed below. The company uses the activity rates to assign overhead costs to products:

Activity Cost Pool	Activity Rate
Processing customer orders	$95.67	per customer order
Assembling products	$3.41	per assembly hour
Setting up batches	$54.32	per batch

Last year, Product Q06J involved 7 customer orders, 524 assembly hours, and 24 batches. How much overhead cost would be assigned to Product Q06J using the activity-based costing system?

$68,669.05

$1,906.90

$3,760.21

$1,303.68

Betterton Corporation uses an activity based costing system to assign overhead costs to products. In the first stage, two overhead costs—equipment depreciation and supervisory expense-are allocated to three activity cost pools—Machining, Order Filling, and Other—based on resource consumption. Data to perform these allocations appear below:

Overhead costs:
Equipment depreciation	$	70,000
Supervisory expense	$	4,450

Distribution of Resource Consumption Across Activity Cost Pools:
	Activity Cost Pools
	Machining	Order Filling	Other
Equipment depreciation	0.50	0.30	0.20
Supervisory expense	0.10	0.40	0.50

In the second stage, Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:

Activity:
	MHs (Machining)			Orders (Order Filling)
Product A8		4,900			2,400
Product K2		26,500			7,200
Total		31,400			9,600

How much overhead cost is allocated to the Machining activity cost pool under activity-based costing in the first stage of allocation?

$445

$16,440

$35,000

$35,445

Studler Corporation has an activity-based costing system with three activity cost pools—Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow:

Overhead costs:
Equipment expense	$	82,525
Indirect labor	$	3,750

Distribution of Resource Consumption Across Activity Cost Pools:
	Activity Cost Pools
	Processing			Supervising			Other
Equipment expense		0.60			0.20			0.20
Indirect labor		0.10			0.50			0.40

Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow:

Activity:
	MHs (Processing)	Batches (Supervising)
Product Y4	1,800	120
Product R6	10,200	2,280
Total	12,000	2,400

What is the overhead cost assigned to Product R6 under activity-based costing? (Round intermediate answers to two decimal places.)

Noreen 4e Rechecks 2017-24-03

$42,997

$59,897

$17,465

$42,432

Schwering Corporation uses activity-based costing to assign overhead costs to products. Overhead costs have already been allocated to the company's three activity cost pools as follows: Machining, $81,600; Order Filling, $161,500; and Other, $68,200. Machining costs are assigned to products using machine-hours (MHs) and Order Filling costs are assigned to products using the number of orders. The costs in the Other activity cost pool are not assigned to products. Activity data appear below:

	MHs (Machining)		Orders (Order Filling)
Product D7		13,200		4,000
Product U1		26,800		1,000

What is the overhead cost assigned to Product U1 under activity-based costing?

86,972

100,000

32,300

54,672

The controller of Hartis Corporation estimates the amount of materials handling overhead cost that should be allocated to the company's two products using the data that are given below:

	Wall Mirrors	Specialty Windows
Total expected units produced	16,500	1,600
Total expected material moves	1,650	1,500
Expected direct labor-hours per unit	9	4

The total materials handling cost for the year is expected to be $16,562.20.

If the materials handling cost is allocated on the basis of direct labor-hours, the total materials handling cost allocated to the wall mirrors is closest to: (Round your intermediate calculations to 2 decimal places.)

$16,335

$14,042

$10,714

$9,065

Thoen Nuptial Bakery makes very elaborate wedding cakes to order. The company has an activity-based costing system with three activity cost pools. The activity rate for the Size-Related activity cost pool is $1.00 per guest. (The greater the number of guests, the larger the cake.) The activity rate for the Complexity-Related cost pool is $62.77 per tier. (Cakes with more tiers are more complex.) Finally, the activity rate for the Order-Related activity cost pool is $64.97 per order. (Each wedding involves one order for a cake.) The activity rates include the costs of raw ingredients such as flour, sugar, eggs, and shortening. The activity rates do not include the costs of purchased decorations such as miniature statues and wedding bells, which are accounted for separately.

Data concerning two recent orders appear below:

	NieWedding		StroblWedding
Number of reception guests		74		143
Number of tiers on the cake		3		5
Cost of purchased decorations for cake	$	30.70	$	48.73

Assuming that the company charges $639.31 for the Strobl wedding cake, what would be the overall margin on the order? (Round your final answer to 2 decimal places)

$117.49

$68.76

$133.73

$570.55

Answer 1

1.

Total Overhead applied

= Assembly (1,443,140/59,000)*2070 + Processing (80,905/2750)*41 + Inspection (145,733/1910)*35

= 50632.2+1206.22+2670.50 = 54,508.92

Overhead per unit = (54,508.92/890) = 61.25 per unit

Product margin = (Selling price - Cost of Goods Sold) * units sold

= (146.50 - ((56.46+22.67+61.25))*890

= 5450.38 (rounded)