Question

QUESTION 1 P Flag question Marked out of 25.00 Not yet answere d 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 $252,000, consisting of the following activity cost pools for the current month: Activity Centers Activity Costs Cost Drivers Activity Level Assembly setups $69,000 Setup hours 1,500 Materials handling Number of moves 39,000 300 120,000 Assembly hours Assembly 12,000 Maintenance 24,000 Maintenance hours 1,200 Total $252,000 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 Z205 Units produced 1,000 1,000 Direct materials costs $39,000 $39,000 $36,500 Direct labor costs $36,500 Direct labor hours 500 500 Setup hours 50 100 Materials moves 25 50 Assembly hours 800 800 Maintenance hours 10 40 a. Calculate the total per-unit cost of each model using direct labor hours to assign manufacturing overhead to products. Round rate to two decimal places. Overhead rate per direct labor hour a. Calculate the total per-unit cost of each model using direct labor hours to assign manufacturing overhead to products. Round rate to two decimal places. Overhead rate per direct labor hour Use rounded overhead rate calculated above for calculations below. Round cost answers to the nearest whole number, when needed. Round cost per unit to two decimal places, if needed. X301 z205 Direct materials $ Direct labor Overhead cost Total cost Units Per unit cost b. Calculate the total per-unit cost of each model using activity-based costing to assign manufacturing overhead to products. Assembly setups per setup hour Materials handling $ per move Assembly per assembly hour Maintenance per maintenance hour Round cost per unit to two decimal places, if needed. Z 5 X301 $ Direct materials cost Direct labor cost Manufacturing overhead costs: Assembly setup Materials handling Assembly Maintenance Total cost Units Per unit cost QUESTION 2 PFlag question ot yet answered Marked out of 25.00 Dudley Manufacturing shows the following information: Inventories: Beginning Ending Materials $ 59,000 $ 22,000 Work in process Finished goods 61,000 103,000 58,000 49,000 Other Information: Direct Labor 150,000 Factory Insurance Factory taxes Factory utilities 25,000 Indirect Labor 31,000 10,000 Cost of material purchased 152,000 18,000 Z 5 X301 $ Direct materials cost Direct labor cost Manufacturing overhead costs: Assembly setup Materials handling Assembly Maintenance Total cost Units Per unit cost QUESTION 2 PFlag question ot yet answered Marked out of 25.00 Dudley Manufacturing shows the following information: Inventories: Beginning Ending Materials $ 59,000 $ 22,000 Work in process Finished goods 61,000 103,000 58,000 49,000 Other Information: Direct Labor 150,000 Factory Insurance Factory taxes Factory utilities 25,000 Indirect Labor 31,000 10,000 Cost of material purchased 152,000 18,000

Answer 1

a. Computation of total per unit cost of each model using direct labor hours to assign manufacturing overhead to products:-
Computation of overhead rate per hour :-
	Estimated Total manufacturing Overhead Cost			$252,000
	Estimated total Direct labor hours			8,000	DLHs
	Overhead rate per direct labor hour		=	Estimated Total manufacturing Overhead Cost
				Estimated total Direct labor hours
			=	$252,000
				8000
			=	$31.50	per DLH

Computation of Manufacturing Cost per unit:-
			Products
			Model X301	Model Z205
a	Direct labor hours		500	500
b	Overhead rate per direct labor hour		$31.50	$31.50
c	Overhead Cost (a*b)		$15,750	$15,750
			Products
			Model X301	Model Z205
	Direct Material Cost		$39,000	$39,000
	Direct labor Cost		$36,500	$36,500
	Overhead Cost		$15,750	$15,750
	Total Cost		$91,250	$91,250
	Units		1000	1000
	Per Unit Cost		91.25	91.25
b. Computation of total per unit cost of each model using activity based costing to assign manufacturing overhead to products:-
Computation of Activity rate using activity based costing system:-
Activities	Activity measures	Estimated Overhead Cost	Activity Level	Activity Rate
			Total
a	b	c	d	e = c/d
Assembly setups	Setup hours	$69,000	1,500	$46.00	per setup hour
Materials handling	Number of moves	$39,000	300	$130.00	per move
Assembly setups	Assembly hours	$120,000	12,000	$10.00	per assembly hour
Maintenance	Maintenance hours	$24,000	1,200	$20.00	per maintenance hour
Total Manufacturing Overhead Cost		$252,000
Computation of unit product cost using activity based costing system:-
Computation of Overhead Cost :-
	Overhead Assigned	Activity Driver			Activity Rate	Total Overhead Cost
	a	b			c	d = b×c
	Model X301
	Assembly setups	50	Setup hours		$46.00	$2,300
	Materials handling	25	Number of moves		$130.00	$3,250
	Assembly setups	800	Assembly hours		$10.00	$8,000
	Maintenance	10	Maintenance hours		$20.00	$200
					Total	$13,550
	Model Z205
	Assembly setups	100	Setup hours		$46.00	$4,600
	Materials handling	50	Number of moves		$130.00	$6,500
	Assembly setups	800	Assembly hours		$10.00	$8,000
	Maintenance	40	Maintenance hours		$20.00	$800.00
					Total	$19,100
Computation of Manufacturing Cost Per unit
			Products
			Model X301	Model Z205
	Direct Material Cost		$39,000	$39,000
	Direct labor Cost		$36,500	$36,500
	Manufacturing Overhead Costs:
	Assembly setups		$2,300	$4,600
	Materials handling		$3,250	$6,500
	Assembly setups		$8,000	$8,000
	Maintenance		$200	$800
	Total Cost		$89,250	$95,400
	Units		1000	1000
	Per Unit Cost		89.25	95.40

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