Cost Behavior SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = $539,780 + $1.32X, where X equals number of smokers. Last year, SmokeCity produced 19,700 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? For questions 2-4, Enter the final answers rounded to the nearest dollar. 2. What is the total overhead cost incurred by SmokeCity last year? 3. What is the total fixed overhead cost incurred by SmokeCity last year?
Cost Behavior SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = $539,780 + $1.32X, where X equals number of smokers. Last year, SmokeCity produced 19,700 smokers. Actual overhead costs for the year were as expected. Required: 1. What is the driver for the overhead activity? For questions 2-4, Enter the final answers rounded to the nearest dollar. 2. What is the total overhead cost incurred by SmokeCity last year? 3. What is the total fixed overhead cost incurred by SmokeCity last year?
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
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Chapter3: Cost Behavior
Section: Chapter Questions
Problem 10E: SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that...
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Standard Costing
The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.
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Cost Behavior
SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = $539,780 +
$1.32X, where X equals number of smokers. Last year, SmokeCity produced 19,700 smokers. Actual overhead costs for the year were as expected.
Required:
1. What is the driver for the overhead activity?
For questions 2-4, Enter the final answers rounded to the nearest dollar.
2. What is the total overhead cost incurred by SmokeCity last year?
3. What is the total fixed overhead cost incurred by SmokeCity last year?
4. What is the total variable overhead cost incurred by SmokeCity last year?
Transcribed Image Text:Cost Behavior
SmokeCity, Inc., manufactures barbeque smokers. Based on past experience, SmokeCity has found that its total annual overhead costs can be represented by the following formula: Overhead cost = $539,780 +
$1.32X, where X equals number of smokers. Last year, SmokeCity produced 19,700 smokers. Actual overhead costs for the year were as expected.
Required:
1. What is the driver for the overhead activity?
For questions 2-4, Enter the final answers rounded to the nearest dollar.
2. What is the total overhead cost incurred by SmokeCity last year?
3. What is the total fixed overhead cost incurred by SmokeCity last year?
4. What is the total variable overhead cost incurred by SmokeCity last year?
For questions 5-7, round your answers to the nearest cent. Use those rounded figures in subsequent computations, if necessary.
5. What is the overhead cost per unit produced?
per unit
6. What is the fixed overhead cost per unit?
per unit
7. What is the variable overhead cost per unit?
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