Question

Activity-Based Costing and Conventional Costs Compared
Hickory Grill Company manufactures two types of cooking grills: the Gas Cooker and the Charcoal Smoker. The Cooker is a premium product sold in upscale outdoor shops; the Smoker is sold in major discount stores. Following is information pertaining to the manufacturing costs for the current month.

	Gas Cooker	Charcoal Smoker
Units	1,000	4,000
Number of batches	50	10
Number of batch moves	80	20
Direct materials	$40,000	$90,000
Direct labor	$20,000	$25,000

Manufacturing overhead follows:

Activity	Cost	Cost Driver
Materials acquisition and inspection	$52,000	Amount of direct materials cost
Materials movement	17,450	Number of batch moves
Scheduling	30,000	Number of batches
	$99,450

a. Determine the total and per-unit costs of manufacturing the Gas Cooker and Charcoal Smoker for the month, assuming all manufacturing overhead is assigned on the basis of direct labor dollars.
Round rate to two decimal places, if applicable.
Manufacturing overhead based on direct labor dollars: $Answer

per direct labor dollar
Use rounded overhead rate calculated above for calculations below. Round cost answers to the nearest whole number, when needed. Round cost per unit to two decimal places, if needed.

Product Costs per Unit
	Gas Cooker	Charcoal Smoker
Direct materials	Answer	Answer
Direct labor	Answer	Answer
Manufacturing overhead:	Answer	Answer
Total cost	Answer	Answer
Units	Answer	Answer
Cost per unit	Answer	Answer

b. Determine the total and per-unit costs of manufacturing the Gas Cooker and Charcoal Smoker for the month, assuming manufacturing overhead is assigned using activity-based costing.
Round answers to two decimal place, if needed.
Activity-based overhead rates:
Materials acquisition and handling $Answer

per direct material dollar
Materials movement $Answer

per move
Scheduling $Answer

per batch

Use rounded overhead rate calculated above for calculations below. Round cost answers to the nearest whole number, when needed. Round cost per unit to two decimal places, if needed.

Product Costs per Unit
	Gas Cooker	Charcoal Smoker
Direct materials	Answer	Answer
Direct labor	Answer	Answer
Manufacturing overhead:
Materials acquisition	Answer	Answer
Materials movement	Answer	Answer
Scheduling	Answer	Answer
Total cost per batch	Answer	Answer
Number of units per batch	Answer	Answer
Cost per unit	Answer	Answer

Answer 1