Question

Desilets Corporation has provided the following data from its activity-based costing accounting system: Supervisory wages $ 85,600 Factory utilities $ 306,000 Distribution of Resource Consumption across Activity Cost Pools: Activity Cost Pools Batch Set-Ups Unit Processing Other Total Supervisory wages 60 % 37 % 3 % 100 % Factory utilities 29 % 63 % 8 % 100 % The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs that are not assigned to products. Required: a. Determine the total amount of supervisory wages and factory utilities costs that would be allocated to the Unit Processing activity cost pool. b. Determine the total amount of supervisory wages and factory utilities costs that would NOT be assigned to products. Determine the total amount of supervisory wages and factory utilities costs that would NOT be assigned to products. Unassigned Costs Supervisory wages Factory utilities

Answer 1

Answer

• All working forms part of the answer
• Working #1

	% used	Supervisory Wages to be allocated	Cost Allocated
Batch Setups	60%	$85,600	$51,360
Units processing	37%	$85,600	$31,672
Other	3%	$85,600	$2,568
Total Supervisory Wages			$85,600

• Working #2

	% used	Factory Utilities	Cost Allocated
Batch Setups	29%	$306,000	$88,740
Units processing	63%	$306,000	$192,780
Other	8%	$306,000	$24,480
Total Factory Utilities			$306,000

• Requirement ‘a’

The total amount of supervisory wages and factory utilities costs that would be allocated to the Unit Processing activity cost pool

	Supervisory Wages	Factory Utilities	TOTAL
Units processing	$31,672	$192,780	$ 224,452

• Requirement ‘b’

	Supervisory Wages	Factory Utilities	TOTAL
Unassigned Cost	$2,568	$24,480	$ 27,048