Drilling Company uses activity-based costing and provides this information: Driver Rate Manufacturing Activity Cost Driver Materials handling Number of parts Number of machine hours Number of parts Number of finished units Machinery Assembly Inspection $ 0.40 61.00 3.35 40.00 Drilling has just completed 90 units of a component for a customer. Each unit required 110 parts and 3.50 machine hours. The prime cost is $1,400 per finished unit. All other manufacturing costs are classified as manufacturing overhead. Required: 1. Compute the total manufacturing costs and the unit costs of the 90 units just completed using ABC costing. 2. In addition to the manufacturing costs, the firm has determined that the total cost of upstream activities, including research and development and product design, is $190 per unit. The total cost of downstream activities, such as distribution, marketing, and customer service, is $310 per unit. Compute the full product cost per unit, including upstream, manufacturing, and downstream activities. Also compute the relative proportion of each main cost category. Complete this question by entering your answers in the tabs below.

Drilling Company uses activity-based costing and provides this information: Driver Rate Manufacturing Activity Cost Driver Materials handling Number of parts Number of machine hours Number of parts Number of finished units Machinery Assembly Inspection $ 0.40 61.00 3.35 40.00 Drilling has just completed 90 units of a component for a customer. Each unit required 110 parts and 3.50 machine hours. The prime cost is $1,400 per finished unit. All other manufacturing costs are classified as manufacturing overhead. Required: 1. Compute the total manufacturing costs and the unit costs of the 90 units just completed using ABC costing. 2. In addition to the manufacturing costs, the firm has determined that the total cost of upstream activities, including research and development and product design, is $190 per unit. The total cost of downstream activities, such as distribution, marketing, and customer service, is $310 per unit. Compute the full product cost per unit, including upstream, manufacturing, and downstream activities. Also compute the relative proportion of each main cost category. Complete this question by entering your answers in the tabs below.

Name: ll.Subject :- Accounting Drilling Company uses activity-based costing
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Description: ll.Subject :- Accounting Drilling Company uses activity-based costing and provides this information:DriverRate$0.4061.003.3540.00ManufacturingActivityCost DriverMaterials handling Number of partsNumber of machinehoursNumber of partsNumber of finished

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter2: Accounting For Materials

Section: Chapter Questions

Problem 17E: Davis Co. uses backflush costing to account for its manufacturing costs. The trigger points are the...

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Davis Co. uses backflush costing to account for its manufacturing costs. The trigger points are the purchase of materials, the completion of goods, and the sale of goods. Prepare journal entries to account for the following: a. Purchased raw materials, on account, 70,000. b. Requisitioned raw materials to production, 70,000. c. Distributed direct labor costs, 15,000. d. Factory overhead costs incurred, 45,000. (Use Various Credits for the account in the credit part of the entry.) e. Completed all of the production started. f. Sold the completed production for 195,000, on account. (Hint: Use a single account for raw materials and work in process.)
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