activity-based costing system.
Q: the actual use of an Activity-based costing system should be informed by two essential lessons,…
A: This question tells about the actual use of an Activity-based costing system :
Q: "Standard costing improves the control function" comment
A: Standard costing is one of the technique of accounting. Standard costing is the method which…
Q: benefits of costing system
A: A costing system is prepared to analyze the costs incurred in a business organization. The system…
Q: Define actual costing
A: Actual Costing: Actual costing is based on the actual cost of direct materials, direct labor and…
Q: Why are top management support and cross-functional involvement crucial when attempting to implement…
A: Activity based costing system is a form of costing system in which cost is analysed by dividing the…
Q: - standard costing
A: Standard costing system is the method of setting standards for every costs and revenue and comparing…
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A: “Hey, since there are multiple questions posted, we will answer first question. If you want any…
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A: Value engineering’s main motive is to reduce the cost and to provide good quality products that will…
Q: activity-based costing
A: Activity means an operation under activity-based costing. Activity base means the basis on which the…
Q: Are activity-based costing systems appropriate for the service industry? Explain.
A:
Q: Product Type relation with Attendance endance
A: 1. type of event Pivot Table Hence Highest average attendance is for Concert Type of Event Question…
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A: Process costing is a system in which production cost are allocated to individual production stages…
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A: Cost Allocation is the process of identifying various cost pools and allocating them to cost object…
Q: Describe the term direct costing.
A: Direct costing: It is the method wherein, the variable manufacturing costs are allocated to…
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A: A standard fee accounting gadget works with the aid of using monitoring uncooked substances as they…
Q: How we can improve control function using standard costing
A: Standard costing is the process of reporting or showing differences between actual costs incurred…
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A: Line item budget Actual variance % variance Production Line wages 20,000…
Q: Explain the features of cost management.
A: Cost management is a process of planning and controlling the costs of a business organisation. This…
Q: Analyze process costing with multiple departments
A: Process costing is a technique of costing in which the costs are directly traced to the…
Q: Define the term process-costing system.
A:
Q: How standard costing control the business activity
A: Standard Costing is the technique of setting up standard costs and applying them to measure the…
Q: Describe the flow of costs through a process costing system.
A: Definition: Process costing: Process costing is a method of cost accounting in which all costs are…
Q: Explain the relationship between customer profitability analysis and activity-based costing.
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Q: Describe standard cost system.
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Q: What are the four steps to developing an activity-based costing system?
A: Activity-based costing (ABC): Activity based costing (ABC) framework was created to manage the…
Q: Explain the benefits of Activity Based Costing ( ABC)
A: The overhead cost is applied to the production on the basis of traditional costing or activity based…
Q: What is cost accounting system and operational control system?
A: Introduction: Cost accounting is the reporting and assessment of a company's cost structure. The…
Q: Identify and discuss the factors that affect the focus and practice of cost management.
A: The practice of managing and organizing the expenses associated with running a firm is known as cost…
Q: Define Overhead Allocation.
A: Activity-Based Costing: It is a method that helps in finding the activities performed by a company…
Q: features
A: Activity-Based costing system is a cost accounting system that uses both unit and non-unit based…
Q: Define the term process costing.
A: Process Costing: Process costing is a method of costing used mainly in manufacturing where units are…
Q: Explain the features of cost accounting.
A: Cost accounting is a branch of accounting in which all the costs involved in manufacturing of a…
Q: Define and explain the two major subsystems of the cost management information system.
A: The Cost Accounting Information System (CAIS) is a monetary accounting system that calculates the…
Q: What is activity based costing?
A: Activity based Costing is a method of costing system which focuses on activites. In this method of…
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- Pelder Products Company manufactures two types of engineering diagnostic equipment used in construction. The two products are based upon different technologies, X-ray and ultrasound, but are manufactured in the same factory. Pelder has computed the manufacturing cost of the X-ray and ultrasound products by adding together direct materials, direct labor, and overhead cost applied based on the number of direct labor hours. The factory has three overhead departments that support the single production line that makes both products. Budgeted overhead spending for the departments is as follows: Pelders budgeted manufacturing activities and costs for the period are as follows: The budgeted cost to manufacture one ultrasound machine using the activity-based costing method is: a. 225. b. 264. c. 293. d. 305.Box Springs. Inc., makes two sizes of box springs: queen and king. The direct material for the queen is $35 per unit and $55 is used in direct labor, while the direct material for the king is $55 per unit, and the labor cost is $70 per unit. Box Springs estimates it will make 4,300 queens and 3,000 kings in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?Stacks manufactures two different levels of hockey sticks: the Standard and the Slap Shot. The total overhead of $600,000 has traditionally been allocated by direct labor hours, with 400,000 hours for the Standard and 200.000 hours for the Slap Shot. After analyzing and assigning costs to two cost pools, it was determined that machine hours is estimated to have $450.000 of overhead, with 30,000 hours used on the Standard product and 15,000 hours used on the Slap Shot product. It was also estimated that the inspection cost pool would have $150,000 of overhead, with 25,000 hours for the Standard and 5,000 hours for the Slap Shot. What is the overhead rate per product, under traditional and under ABC costing?
- Douglas Davis, controller for Marston, Inc., prepared the following budget for manufacturing costs at two different levels of activity for 20X1: During 20X1, Marston worked a total of 80,000 direct labor hours, used 250,000 machine hours, made 32,000 moves, and performed 120 batch inspections. The following actual costs were incurred: Marston applies overhead using rates based on direct labor hours, machine hours, number of moves, and number of batches. The second level of activity (the right column in the preceding table) is the practical level of activity (the available activity for resources acquired in advance of usage) and is used to compute predetermined overhead pool rates. Required: 1. Prepare a performance report for Marstons manufacturing costs in the current year. 2. Assume that one of the products produced by Marston is budgeted to use 10,000 direct labor hours, 15,000 machine hours, and 500 moves and will be produced in five batches. A total of 10,000 units will be produced during the year. Calculate the budgeted unit manufacturing cost. 3. One of Marstons managers said the following: Budgeting at the activity level makes a lot of sense. It really helps us manage costs better. But the previous budget really needs to provide more detailed information. For example, I know that the moving materials activity involves the use of forklifts and operators, and this information is lost when only the total cost of the activity for various levels of output is reported. We have four forklifts, each capable of providing 10,000 moves per year. We lease these forklifts for five years, at 10,000 per year. Furthermore, for our two shifts, we need up to eight operators if we run all four forklifts. Each operator is paid a salary of 30,000 per year. Also, I know that fuel costs about 0.25 per move. Assuming that these are the only three items, expand the detail of the flexible budget for moving materials to reveal the cost of these three resource items for 20,000 moves and 40,000 moves, respectively. Based on these comments, explain how this additional information can help Marston better manage its costs. (Especially consider how activity-based budgeting may provide useful information for non-value-added activities.)JoyT Company manufactures Maxi Dolls for sale in toy stores. In planning for this year, JoyT estimated variable factory overhead of 600,000 and fixed factory overhead of 400,000. JoyT uses a standard costing system, and factory overhead is allocated to units produced using standard direct labor hours. The level of activity budgeted for this year was 10,000 direct labor hours, and JoyT used 10,300 actual direct labor hours. Based on the output accomplished during this year, 9,900 standard direct labor hours should have been used. Actual variable factory overhead was 596,000, and actual fixed factory overhead was 410,000 for the year. Based on this information, the variable factory overhead controllable variance for JoyT for this year was: a. 24,000 unfavorable. b. 2,000 unfavorable. c. 4,000 favorable. d. 22,000 favorable.Medical Tape makes two products: Generic and Label. It estimates it will produce 423,694 units of Generic and 652,200 of Label, and the overhead for each of its cost pools is as follows: It has also estimated the activities for each cost driver as follows: How much is the overhead allocated to each unit of Generic and Label?
- Young Company is beginning operations and is considering three alternatives to allocate manufacturing overhead to individual units produced. Young can use a plantwide rate, departmental rates, or activity-based costing. Young will produce many types of products in its single plant, and not all products will be processed through all departments. In which one of the following independent situations would reported net income for the first year be the same regardless of which overhead allocation method had been selected? a. All production costs approach those costs that were budgeted. b. The sales mix does not vary from the mix that was budgeted. c. All manufacturing overhead is a fixed cost. d. All ending inventory balances are zero.Jillian Manufacturing Inc. manufactures a single product and uses a standard cost system. The factory overhead is applied on the basis of direct labor hours. A condensed version of the company’s flexible budget follows: The product requires 3 lb of materials at a standard cost of $5 per pound and 2 hours of direct labor at a standard cost of $10 per hour. For the current year, the company planned to operate at the level of 6,250 direct labor hours and to produce 3,125 units of product. Actual production and costs for the year follow: Required: For the current year, compute the factory overhead rate that will be used for production. Show the variable and fixed components that make up the total predetermined rate to be used. Prepare a standard cost card for the product. Show the individual elements of the overhead rate as well as the total rate. Compute (a) standard hours allowed for production and (b) under- or overapplied factory overhead for the year. Determine the reason for any under- or overapplied factory overhead for the year by computing all variances, using each of the following methods: Two-variance method Three-variance method (appendix) Four-variance method (appendix)Minor Co. has a job order cost system and applies overhead based on departmental rates. Service Department 1 has total budgeted costs of 168,000 for next year. Service Department 2 has total budgeted costs of 280,000 for next year. Minor allocates service department costs solely to the producing departments. Service Department 1 cost is allocated to producing departments on the basis of machine hours. Service Department 2 cost is allocated to producing departments on the basis of direct labor hours. Producing Department 1 has budgeted 8,000 machine hours and 12,000 direct labor hours. Producing Department 2 has budgeted 2,000 machine hours and 12,000 direct labor hours. What is the total cost allocation from the two service departments to Producing Department 1? a. 173,600 b. 140,000 c. 134,400 d. 274,400
- Moleno Company produces a single product and uses a standard cost system. The normal production volume is 120,000 units; each unit requires 5 direct labor hours at standard. Overhead is applied on the basis of direct labor hours. The budgeted overhead for the coming year is as follows: At normal volume. During the year, Moleno produced 118,600 units, worked 592,300 direct labor hours, and incurred actual fixed overhead costs of 2,150,400 and actual variable overhead costs of 1,422,800. Required: 1. Calculate the standard fixed overhead rate and the standard variable overhead rate. 2. Compute the applied fixed overhead and the applied variable overhead. What is the total fixed overhead variance? Total variable overhead variance? 3. CONCEPTUAL CONNECTION Break down the total fixed overhead variance into a spending variance and a volume variance. Discuss the significance of each. 4. CONCEPTUAL CONNECTION Compute the variable overhead spending and efficiency variances. Discuss the significance of each.Bach Instruments Inc. makes three musical instruments: flutes, clarinets, and oboes. The budgeted factory overhead cost is 2,948,125. Overhead is allocated to the three products on the basis of direct labor hours. The products have the following budgeted production volume and direct labor hours per unit: a. Determine the single plant wide overhead rate. b. Use the overhead rate in (a) to determine the amount of total and per-unit overhead allocated to each of the three products, rounded to the nearest dollar.Box Springs, Inc., makes two sizes of box springs: twin and double. The direct material for the twin is $25 per unit and $40 s used in direct labor, while the direct material for the double is $40 per unit, and the labor cost is $50 per unit. Box Springs estimates it will make 5,000 twins and 9,000 doubles in the next year. It estimates the overhead for each cost pool and cost driver activities as follows: How much does each unit cost to manufacture?