Question
In: Accounting
Using the ABC system, how much total manufacturing overhead cost would be assigned to Product TOSP?
Kulka Corporation manufactures two products Product F82D and Product TO5P. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products F82D and TO5P.
Using the ABC system, how much total manufacturing overhead cost would be assigned to Product TOSP?
Multiple Choice
$147,000
$304,500
$156,000
$303,000
Solutions
Expert Solution
Using the ABC system, total manufacturing overhead cost assigned to Product T05P = $303000
Calculation:
Activity rate:
1. Machining = Total cost / Total activity
= $180000 / 9000 machine-hours
= $20 per machine-hour
2. Machine-setups = Total cost / Total activity
= $125000 / 250 setups
= $500 per setup
3. Product design = Total cost / Total activity
= $44000 / 2 products
= $22000 per product
4. Order size = Total cost / Total activity
= $260000 / 10000 direct labor-hours
= $26 per direct labor-hour
ABC cost (Product T05P):
1. Machining = Machine-hours * Activity rate
= 4000 machine-hours * $20 per machine-hour
= $80000
2. Machine-setups = Number of setups * Activity rate
= 90 setups * $500 per setup
= $45000
3. Product design = Number of products * Activity rate
= 1 product * $22000 per product
= $22000
4. Order size = Direct labor-hours * Activity rate
= 6000 direct labor-hours * $26 per direct labor-hour
= $156000
Total manufacturing overhead cost assigned to Product T05P:
= $80000 + $45000 + $22000 + $156000
= $303000
ekkarill92 answered 2 years agoRelated Solutions
Using the ABC data, determine the total amount of overhead cost assigned to each product.
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
ExpectedOverhead 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
Board etching
Number of boards
$
63,700
1,820...
Using the ABC data, determine the total amount of overhead cost assigned to each product.
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
$
30,115
1,585
DLHs
Purchase orders
Number of orders
$
2,320
580
orders
Product testing
Number of tests
$
6,930
330
tests
Template etching
Number of templates
$
870
30
templates
General factory
Machine-hours
$
65,100
9,300
MHs
...
Using the ABC system, what percentage of the Product Design cost is assigned to Product Y and Product Z?
14-4The manufactures two products—14,000 units of Product Y and
6,000 units of Product Z. The company uses a plantwide overhead
rate based on direct labor-hours. It is considering implementing an
activity-based costing (ABC) system that allocates all of its
manufacturing overhead to four cost pools. The following additional
information is available for the company as a whole and for
Products Y and Z:Activity Cost PoolActivity MeasureEstimated Overhead CostExpectedActivityMachiningMachine-hours$203,00010,000MHsMachine setupsNumber of setups$121,900230setupsProduction designNumber of products$87,0002productsGeneral factoryDirect labor-hours$379,50015,000DLHsActivity MeasureProduct YProduct ZMachining8,3001,700Number of...
Prepare a report showing the overhead cost of the order for hard rock drills according to the ABC system. What is the total overhead cost assigned to the order?
Ace Mining Tools Ltd. of Calgary makes specialty tools used in the mining industry. The company uses an ABC system for internal decision making. The company has four activity cost pools, as listed below:
Activity Cost Pool
Activity Measure
Activity Rate
Order size
Direct labour-hours
$17.60
Customer orders
Customer orders
$360.00
Product testing
Testing hours
$79.00
Selling
Sales calls
$750.00
The managing director of the company would like information concerning the cost of a recently completed order for...
Using the ABC system, what percentage of Machine Setups cost is assigned to Product Y and Product Z?
The Company manufactures two products—14,000 units of Product Y
and 6,000 units of Product Z. The company uses a plantwide overhead
rate based on direct labor-hours. It is considering implementing an
activity-based costing (ABC) system that allocates all of its
manufacturing overhead to four cost pools. The following additional
information is available for the company as a whole and for
Products Y and Z:Activity Cost PoolActivity MeasureEstimated Overhead CostExpectedActivityMachiningMachine-hours$203,00010,000MHsMachine setupsNumber of setups$121,900230setupsProduction designNumber of products$87,0002productsGeneral factoryDirect labor-hours$379,50015,000DLHsActivity MeasureProduct YProduct ZMachining8,3001,700Number...
Last year, Product H50E involved 9 customer orders, 666 assembly hours, and 77 batches. How much overhead cost would be assigned to Product H50E using the activity-based costing system?
Activity rates from Lippard Corporation's activity-based costing system are listed below. The company uses the activity rates to assign overhead costs to products: Activity Cost Pools Activity Rate Setting up batches $46.61 per batch Processing customer orders $31.62 per customer order Assembling products $2.86 per assembly hour Last year, Product H50E involved 9 customer orders, 666 assembly hours, and 77 batches. How much overhead cost would be assigned to Product H50E using the activity-based costing system? $60,979.68$3,588.97$5,778.31$81.09
The total prime cost of a product was OMR4,400. The variable manufacturing overhead is calculated based...
The total prime cost of a product was OMR4,400. The
variable manufacturing overhead is calculated based on the number
of direct labor hours. The variable manufacturing overhead cost per
hour is three times the direct labor cost per hour. The fixed
manufacturing overhead was OMR1,500. Assuming that direct labor
hours were 300 and that the direct labor cost was 10% of direct
materials cost, how much is the total manufacturing cost? Select
one:
a. OMR7,100
b. OMR5,900
c. OMR17,600
d....
What are the manufacturing overhead costs? Assigned costs to products using a predetermined overhead rate using...
What are the manufacturing overhead costs?
Assigned costs to products using a predetermined overhead
rate using a standard costing system, as discussed, job costing,
and manufacturing activity-based costing.
Assume manufacturing overhead costs are often called
overhead costs applied to products going through the
Assembly department.
The journal entry reflect manufacturing overhead costs applied
to products going through the Finishing department is as
follows:
Transferred-In Costs
The costs associated with manufacturing should transfer from the
work-in-process inventory account for the production...
determine the total amount of manufacturing overhead,product costs & period costs
Caroline Company reports the following costs and expenses in May.Factory Utilities 11,500Depreciation on factory equipment 12,650Depreciation on delivery trucks 3,800Indirect factory labor 48,900indirect materials 80,800Direct materials used 137,600Factory manager's salary 8,000Direct labor 69,100Sales salaries 46,400Property taxes on factory building 2,500Repairs to office equipment 1,300factory repairs 2,000Advertising 18,000office supplies used 2,640
InstructionsFrom the information, determine the total amount of:(a) Manufacturing overhead.(b) Product costs.(c) Period costs.
How much manufacturing overhead was applied to Job P and how much was applied to Job Q?
Sweeten Company had no jobs in progress at the beginning of March and no beginning inventories. The company has two manufacturing departments--Molding and Fabrication. It started, completed, and sold only two jobs during March—Job P and Job Q. The following additional information is available for the company as a whole and for Jobs P and Q (all data and questions relate to the month of March): Molding Fabrication Total Estimated total machine-hours used 2,500 1,500 4,000 Estimated total fixed manufacturing...
ADVERTISEMENT
ADVERTISEMENT
Latest Questions
- MARGI sells different types of wine. Customers place orders to the most popular “Summer Wine” at...
- Java. If possible please put explanations for each line of code. Write a test program that...
- . Use the following information to calculate your company's expected return State Probability Return Boom 20%...
- You are considering the following two projects and can only take one. Your cost of capital...
- C++: Write a program that produces truth tables for the following compound propositions. Write the header...
- 1. What is the historical role of investment bankers ? Has this role changed ? Why...
- How were the original Internet requirements met through its design? What are the two main requirements...
ADVERTISEMENT