Question
In: Accounting
X Company uses an activity-based costing allocation system. On January 1, 2020, its accountant budgeted the...
X Company uses an activity-based costing allocation system. On
January 1, 2020, its accountant budgeted the following costs and
cost drivers for three of the activities that are used in the ABC
system:
| Activity | Budgeted cost | Cost driver |
| Assembly | $79,000 | 89,800 parts |
| Packaging | $47,400 | 14,400 finished units |
| Purchasing | $31,600 | 4,200 purchase orders |
In May of 2020, 521 units of Product C were finished, requiring
$18,400 of direct materials, 4,000 direct labor hours, 1,464 parts,
and 38 purchase orders.
How much of the three activity costs was allocated to Product
C?
Solutions
Expert Solution
| Final Answer: $3,288 | |||||
| Note 1: Overhead allocation sheet | |||||
| Product C | |||||
| Activity | Total OH Cost | Total Cost Driver | OH Rate | Driver Incurred | OH Cost assigned |
| Purchasing | 79,000 | 89,800 | 0.88 | 1,464 | 1,288 |
| packaging | 47,400 | 14,400 | 3.29 | 521 | 1,714 |
| Assembly | 31,600 | 4,200 | 7.52 | 38 | 286 |
| Total | 158,000 | 3,288 | |||
ekkarill92 answered 1 year agoRelated Solutions
X Company uses an activity-based costing allocation system. On January 1, 2020, its accountant budgeted the...
X Company uses an activity-based costing allocation system. On
January 1, 2020, its accountant budgeted the following costs and
cost drivers for three of the activities that are used in the ABC
system:
Activity
Budgeted cost
Cost
driver
Assembly
$79,000
90,400 parts
Packaging
$47,400
14,600 finished units
Purchasing
$31,600
4,700 purchase orders
In May of 2020, 600 units of Product C were finished, requiring
$13,300 of direct materials, 4,000 direct labor hours, 1,382 parts,
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X Company uses an activity-based costing allocation system. On January 1, 2020, its accountant budgeted the...
X Company uses an activity-based costing allocation system. On
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cost drivers for three of the activities that are used in the ABC
system:
Activity
Budgeted cost
Cost
driver
Purchasing
$53,600
4,400 purchase orders
Assembly
$134,000
98,700 parts
Packaging
$80,400
14,100 finished units
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Product testing
58,700
Packaging
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Product A
All Products
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for 2017 were as follows: Cost Pool 1 Cost Pool 2 Cost Pool 3
Budgeted costs $113,000 $53,000 $31,000 Cost Drivers Product A
84,000 62,000 75,000 Product B 63,000 54,000 47,000
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ABC Company uses a traditional costing system. Management is considering switching to an activity-based costing system....
ABC Company uses a traditional costing system. Management is
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Emerson Evergreen, a landscaping services company, uses an activity-based costing system for its overhead costs. The...
Emerson Evergreen, a landscaping services company, uses an
activity-based costing system
for its overhead costs. The company has provided the following data
from its activity-based
costing system.
Activity Cost Pool Total Cost Total Activity
Landscaping $101,574 16,200 hours
Job support 32,724 1,800 jobs
Client support. 5,472 320 clients
Other 100,000 Not applicable
Total $239,770
The "Other" activity cost pool consists of the costs of idle
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During the year, the Gallimore family requested 32 jobs that
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Sultan Company uses an activity-based costing system. At the beginning of the year, the company made...
Sultan Company uses an activity-based costing system.
At the beginning of the year, the company made the following
estimates of cost and activity for its five activity cost
pools:
Activity Cost Pool
Activity Measure
Expected
Overhead Cost
Expected Activity
Labor-related
Direct labor-hours
$
174,000
34,800
DLHs
Purchase orders
Number of orders
$
7,200
240
orders
Parts management
Number of part types
$
66,500
95
part types
Board etching
Number of boards
$
64,800
1,620
boards
General factory
Machine-hours
$
115,200...
Sultan Company uses an activity-based costing system. At the beginning of the year, the company made...
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beginning of the year, the company made the following estimates of
cost and activity for its five activity cost pools:
Activity Cost Pool Activity Measure Expected Overhead Cost
Expected Activity Labor-related Direct labor-hours $ 311,500 44,500
DLHs
Purchase orders Number of orders $ 8,840 221 orders
Parts management Number of part types $ 71,280 99 part types
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Sultan Company uses an activity-based costing system. At the beginning of the year, the company made...
Sultan Company uses an activity-based costing system.
At the beginning of the year, the company made the following
estimates of cost and activity for its five activity cost
pools:
Activity Cost Pool
Activity Measure
Expected
Overhead Cost
Expected Activity
Labor-related
Direct labor-hours
$
317,600
39,700
DLHs
Purchase orders
Number of orders
$
9,900
220
orders
Parts management
Number of part types
$
67,890
93
part types
Board etching
Number of boards
$
76,000
1,900
boards
General factory
Machine-hours
$
237,600...
Sultan Company uses an activity-based costing system. At the beginning of the year, the company made...
Sultan Company uses an activity-based costing system. At the
beginning of the year, the company made the following estimates of
cost and activity for its five activity cost pools: Activity Cost
Pool Activity Measure Expected Overhead Cost Expected Activity
Labor-related Direct labor-hours $ 270,900 30,100 DLHs Purchase
orders Number of orders $ 11,745 261 orders Parts management Number
of part types $ 78,570 97 part types Board etching Number of boards
$ 72,400 1,810 boards General factory Machine-hours $ 212,400...
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