Question
In: Accounting
HiTech Products manufactures three types of remote control devices Economy.
HiTech Products manufactures three types of remote control devices Economy. Standard and Deluxe The company, which uses activity-based costing, has identified five activities (and related cost drivers). Each activity, its budgeted cost, and related cost driver is identified below
| Activity | Cost | Cost Driver |
| Material handling | $ 225,000 | Number of parts |
| Material insertion | 2,475,000 | Number of parts |
| Automated machinery | 840,000 | Machine hours |
| Finishing | 170,000 | Direct labor hours |
| Packaging | 170,000 | Orders shipped |
| Total | $3,880,000 |
The following information pertains to the three product lines for next year:
| Units to be produced | Economy | Standard | Deluxe |
|---|---|---|---|
| Orders to be shipped | 10,000 | 5,000 | 2,000 |
| Number of parte per unit | 1,000 | 500 | 200 |
| Machine hours per unit | 1 | 3 | 5 |
| Labor hours per unit | 2 | 2 | 2 |
17. Under an activity-based costing system, what is the per-unit cost of Economy?
A $164. B. $141 C. $225. D. $228. E. An amount other than those listed above.
18. Assume that HiTech is using a volume-based costing system, and the preceding manufacturing costs are applied to all products based on direct labor hours. How much of the preceding cost would be assigned to Deluxe?
A $456,471 B $646.471 $961,176. D $1,141,176 E An amount other than those listed above.
Solutions
ekkarill92 answered 2 years agoRelated Solutions
HiTech Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses...
HiTech Products manufactures three types of
remote-control devices: Economy, Standard, and Deluxe. The company,
which uses activity-based costing, has identified five activities
(and related cost drivers). Each activity, its budgeted cost, and
related cost driver is identified below
Activity Cost
Material Handling $225,000
Material Insertion $2,475,000
Automated machinery $840,000
Finishing $170,000
Packaging $170,000
The following information pertains to the three product
lines for next year:
Economy Standard Deluxe
Unit 2 be prod. 10,000 5,000 2,000
Order 2 ship 1,000 500...
HiTech Products manufactures three types of remote-control devices: Economy, Standard, and Deluxe. The company, which uses...
HiTech Products manufactures three types of remote-control
devices: Economy, Standard, and Deluxe. The company, which uses
activity-based costing, has identified five activities (and related
cost drivers). Each activity, its budgeted cost, and related cost
driver is identified below.
Activity
Cost
Cost
Driver
Material
handling
$269,000
Number of
parts
Material
insertion
3,390,000
Number of
parts
Automated
machinery
872,000
Machine
hours
Finishing
256,000
Direct labor
hours
Packaging
256,000
Orders
shipped
Total
$5,043,000
...
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Activity Budgeted
Costs Cost
Driver
Material
Handling 225,000 #
of Parts
Material
Insertion 2,475,000 #
of Parts
Automate
Machinery 840,000 Machine
Hours
Finishing 170,000 Labor
Hours
Packaging 170,000 Orders
Shipped
Total indirect
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215,000
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