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In: Accounting

Assume that manufacturing overhead for Glassman Company consisted of the following activities and costs: Setup (1,000...

Assume that manufacturing overhead for Glassman Company consisted of the following activities and costs:

Setup (1,000 setup hours) $ 146,000
Production scheduling (400 batches) 60,000
Production engineering (60 change orders) 90,000
Supervision (2,000 direct labor hours) 56,000
Machine maintenance (12,000 machine hours) 96,000
Total activity costs $ 448,000


The following additional data were provided for Job 845:

Direct material costs $ 8,000
Direct labor cost (5 Milling direct labor hours; 35 Finishing direct labor hours) $ 1,000
Setup hours 5 hours
Production scheduling 1 batch
Machine hours used (25 Milling machine hours;5 Finishing machine hours) 30 hours
Production engineering 3 change orders


(a) Calculate the cost per unit of activity driver for each activity cost category.

Setup Answer
Production scheduling Answer
Production engineering Answer
Supervision Answer
Machine operating Answer


(b) Calculate the cost of Job 845 using ABC to assign the overhead costs.
$Answer

(c) Calculate the cost of Job 845 using the plantwide overhead rate based on machine hours. (Round your answer to the nearest dollar.)
$Answer

(d) Calculate the cost of Job 845 using a machine hour departmental overhead rate for the Milling Department ($28 per hour) and a direct hour overhead rate for the Finishing Department ($100 per hour). (Round your answer to the nearest dollar.)
$Answer

Solutions

Expert Solution

Answer to Question a:

Answer to Question b:

Activity Cost = Activity Rate X Activity Consumed

Answer to Question c and d:

ekkarill92 answered 1 year ago
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