Activity-Based Costing HealthTec Equipment Company manufactures stationary bicycles and treadmills. The products are produced in the Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows: Activity Activity Rate Fabrication $30 per machine hour (mh) Assembly $15 per direct labor hour (dlh) Setup $50 per setup Inspecting $27 per inspection Production scheduling $18 per production order Purchasing $6 per purchase order The activity-base usage quantities and units produced for each product were as follows: Stationary Bicycle Treadmill Machine hours 2,230 890 Direct labor hours 400 170 Setups 60 20 Inspections 690 320 Production orders 60 50 Purchase orders 150 130 Units produced 1,000 1,000 Use the activity rate and usage information to compute the total activity costs and the activity costs per unit for each product. If required, round your answers to two decimal places.
Activity-Based Costing HealthTec Equipment Company manufactures stationary bicycles and treadmills. The products are produced in the Fabrication and Assembly production departments. In addition to production activities, several other activities are required to produce the two products. These activities and their associated activity rates are as follows: Activity Activity Rate Fabrication $30 per machine hour (mh) Assembly $15 per direct labor hour (dlh) Setup $50 per setup Inspecting $27 per inspection Production scheduling $18 per production order Purchasing $6 per purchase order The activity-base usage quantities and units produced for each product were as follows: Stationary Bicycle Treadmill Machine hours 2,230 890 Direct labor hours 400 170 Setups 60 20 Inspections 690 320 Production orders 60 50 Purchase orders 150 130 Units produced 1,000 1,000 Use the activity rate and usage information to compute the total activity costs and the activity costs per unit for each product. If required, round your answers to two decimal places.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter4: Activity-based Costing
Section: Chapter Questions
Problem 4PA: Activity-based product costing Mello Manufacturing Company is a diversified manufacturer that...
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