Question
In: Accounting
Catalina Sails makes sails for small sailboats. It recently switched to activity-based costing from the department...
Catalina Sails makes sails for small sailboats. It recently switched to activity-based costing from the department product costing method. The manager of Department Y, which manufactures the sails, has identified the following cost drivers and rates for overhead: Activity Centers Cost Drivers Rate per Cost Driver Unit Materials handling Yards of material handled $ 0.65 per yard Quality inspections Number of inspections $ 110 per inspection Machine setups Number of machine setups $ 900 per setup Running machines Number of machine-hours $ 12 per hour Direct materials costs were $195,000 and direct labor costs were $104,000 during October, when Building S handled 37,100 yards of materials, made 700 inspections, had 100 setups, and ran the machines for 19,600 hours. Required: Use T-accounts to show the flow of materials, labor, and overhead costs from the four overhead activity centers through Work-in-Process Inventory and out to Finished Goods Inventory.
Solutions
ekkarill92 answered 1 year agoRelated Solutions
Catalina Sails makes sails for small sailboats. It recently switched to activity-based costing from the department...
Catalina Sails makes sails for small sailboats. It recently
switched to activity-based costing from the department product
costing method. The manager of Department Y, which manufactures the
sails, has identified the following cost drivers and rates for
overhead: Activity Centers Cost Drivers Rate per Cost Driver Unit
Materials handling Yards of material handled $ 1.20 per yard
Quality inspections Number of inspections $ 120 per inspection
Machine setups Number of machine setups $ 600 per setup Running
machines Number of...
Southwest Components recently switched to activity-based costing from the department allocation method. The Fabrication Department manager...
Southwest Components recently switched to activity-based costing
from the department allocation method. The Fabrication Department
manager has estimated the following cost drivers and rates:
Activity Centers Cost Drivers Rate per Cost Driver Unit Materials
handling Pounds of material handled $ 15 per pound Quality
inspections Number of inspections $ 210 per inspection Machine
setups Number of machine setups $ 2,500 per setup Running machines
Number of machine-hours $ 21.00 per hour Direct materials costs
were $297,000 and direct labor costs...
Southwest Components recently switched to activity-based costing from the department allocation method. The Fabrication Department manager...
Southwest Components recently switched to activity-based costing
from the department allocation method. The Fabrication Department
manager has estimated the following cost drivers and rates:
Activity Centers
Cost Drivers
Rate per
Cost Driver Unit
Materials handling
Pounds of material handled
$
19
per pound
Quality inspections
Number of inspections
$
220
per inspection
Machine setups
Number of machine setups
$
2,900
per setup
Running machines
Number of machine-hours
$
24.00
per hour
Direct materials costs were $285,000 and direct labor costs...
Southwest Components recently switched to activity-based costing from the department allocation method. The Fabrication Department manager...
Southwest Components recently switched to activity-based costing
from the department allocation method. The Fabrication Department
manager has estimated the following cost drivers and rates:
Activity Centers
Cost Drivers
Rate per
Cost Driver Unit
Materials handling
Pounds of material handled
$
20
per pound
Quality inspections
Number of inspections
$
220
per inspection
Machine setups
Number of machine setups
$
2,600
per setup
Running machines
Number of machine-hours
$
21.00
per hour
Direct materials costs were $281,000 and direct labor costs...
Southwest Components recently switched to activity-based costing from the department allocation method. The Fabrication Department manager...
Southwest Components
recently switched to activity-based costing from the department
allocation method. The Fabrication Department manager has estimated
the following cost drivers and rates:
Activity
Centers
Cost
Drivers
Rate per
Cost Driver Unit
Materials
handling
Pounds of
material handled
$
18
per pound
Quality
inspections
Number of
inspections
$
220
per
inspection
Machine
setups
Number of
machine setups
$
2,900
per setup
Running
machines
Number of
machine-hours
$
25.00
per hour
Direct materials costs
were $287,000 and direct labor costs...
Southwest Components recently switched to activity-based costing from the department allocation method. The Fabrication Department manager...
Southwest Components recently switched to activity-based costing
from the department allocation method. The Fabrication Department
manager has estimated the following cost drivers and rates:
Activity
Centers
Cost
Drivers
Rate per
Cost Driver Unit
Materials
handling
Pounds of
material handled
$
17
per pound
Quality
inspections
Number of
inspections
$
230
per
inspection
Machine
setups
Number of
machine setups
$
2,900
per setup
Running
machines
Number of
machine-hours
$
21.00
per hour
Direct materials costs were $283,000 and direct labor costs...
What makes (A) Activity-Based Costing better than Volume-Based Costing, (B) Activity-Based Costing with Practical Capacity better...
What makes
(A) Activity-Based Costing better than Volume-Based Costing,
(B) Activity-Based Costing with Practical Capacity better than
Activity-Based Costing without Practical Capacity,
and
(C) When should management refer to these costing methods?
Question 6 - Halsey Company makes small sailboats. During the most recent month, the following activity...
Question 6 - Halsey Company makes small
sailboats. During the most recent month, the following activity was
recorded in the Hull Fabrication Department for conversion
costs.
Work in process, beginning (80%
complete).................
15,000
units
Units started into
production.............................................
180,000
units
Units transferred to the next
department........................
175,000
units
Work in process, ending (30%
complete).......................
20,000
units
Conversion Costs:
Work in process,
beginning...............................................
$24,000
Conversion costs incurred during the
month.................
$338,000
Required
Assuming that the company uses the weighted average
method:...
Rusties Company recently implemented an activity-based costing system.
Rusties Company recently implemented an activity-based costing system. At the beginning of the year, management made the following estimates of cost and activity in the company’s five activity cost pools:
Activity Cost Pool
Activity Measure
ExpectedOverhead Cost
ExpectedActivity
Labor-related
Direct labor-hours
$
24,912
2,076
DLHs
Purchase orders
Number of orders
$
1,070
535
orders
Product testing
Number of tests
$
4,550
325
tests
Template etching
Number of templates
$
770
35
templates
General factory
Machine-hours
$
52,500
10,500
MHs...
activity based costing
activity based costing
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