Question

QUESTION 23 Nont Company manufactures two products, pillows and comforters. The company has estimated its overhead in the order processing department to be 5500,000. The company produces 50 000 pillows and 30.000 comforters each year Pillow production requires 25 000 machine hours, Comforter production requires 50 000 machine hours. The company places raw materials onders 10 times per month for raw materials for pillows and the remainder for raw materials for comforters. How much of the order processing overhead should be allocated to comforters? 5300 000 5400.000 5369232 5480.000 QUESTION 24 The primary benefit of ABC is provides better management decisions enhanced control over overhead costs more cost pools more accurate produd costing QUESTION 25 Value added activities should be minimized ornated W e those that we ate a company's operations cost to a product without affecting sing price cannot be undone a dded active

Answer 1

10 order poussing over heads - $600000 it should be allocated to plillous and comforters based on number of times the orders are placed pillows a times com for tess - 8 times. Comforters = $600000 X To = $480000 Q ABC coshington Du assigning cost of each activity to all produits based on their consumption *This costing provides us the accurate cost of each product code Answer: - More accurate product losting ( value added activities are those activities which increases the benefit of a good to a customer. These activities increases the profitability. There are very essential for the business operations. & Answer Involve those activities that are essential to a company's operations,