During the week of June 12, Harrison Manufacturing produced and shipped 17,200 units of its aluminum wheels: 4,400 units of Model A and 12,800 units of Model B. The cycle time for Model A is 0.80 hours and that of Model B is 0.55 hours. The total net work hours for the aluminum wheel value stream for the week were 15,000. The following costs were incurred: Salaries/ Materials Wages Machining other Total Cost Order processing $18,600 $18,600 Production planning 167,400 167,400 Purchasing 22,500 22,500 Stamping $370,000 37,000 $36,200 $18,200 461,400 Welding 160,000 41,000 41,000 12,000 254,000 Cladding 215,000 215,000 Testing 10,000 10,000 Packaging and shipping 8,000 8,000 Invoicing 13,000 13,000 Total $745,000 $317,500 $77,200 $30,200 $1,169,900 Required: 1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost. Round your answer to the nearest dollar amount. per unit 2. Model A is responsible for 40 percent of the materials cost. Using the average conversion cost approach, calculate the unit cost for Models A and B. Round your answers to the nearest dollar amount. Unit Cost Model A Model B

Managerial Accounting: The Cornerstone of Business Decision-Making
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Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger
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Chapter13: Emerging Topics In Managerial Accounting
Section: Chapter Questions
Problem 25BEA: During the week of May 10, Hyrum Manufacturing produced and shipped 16,000 units of its aluminum...
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3. What if Model A and Model B are not homogeneous products? Assume the same materials usage as in Requirement 2. Use DBC to calculate the unit cost for the two products. Round your interim calculations and final answers to the
nearest dollar amount.
Unit Cost
Model A
Model B
Transcribed Image Text:3. What if Model A and Model B are not homogeneous products? Assume the same materials usage as in Requirement 2. Use DBC to calculate the unit cost for the two products. Round your interim calculations and final answers to the nearest dollar amount. Unit Cost Model A Model B
During the week of June 12, Harrison Manufacturing produced and shipped 17,200 units of its aluminum wheels: 4,400 units of Model A and 12,800 units of Model B. The cycle time for Model A is 0.80 hours and that of Model B is 0.55 hours. The
total net work hours for the aluminum wheel value stream for the week were 15,000. The following costs were incurred:
Salaries/
Materials
Wages
Machining
Other
Total Cost
Order processing
$18,600
$18,600
Production planning
167,400
167,400
Purchasing
22,500
22,500
Stamping
$370,000
37,000
$36,200
$18,200
461,400
Welding
160,000
41,000
41,000
12,000
254,000
Cladding
215,000
215,000
Testing
10,000
10,000
Packaging and shipping
8,000
8,000
Invoicing
13,000
13,000
Total
$745,000
$317,500
$77,200
$30,200
$1,169,900
Required:
1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost. Round your answer to the nearest dollar amount.
per unit
2. Model A is responsible for 40 percent of the materials cost. Using the average conversion cost approach, calculate the unit cost for Models A and B. Round your answers to the nearest dollar amount.
Unit Cost
Model A
Model B
Transcribed Image Text:During the week of June 12, Harrison Manufacturing produced and shipped 17,200 units of its aluminum wheels: 4,400 units of Model A and 12,800 units of Model B. The cycle time for Model A is 0.80 hours and that of Model B is 0.55 hours. The total net work hours for the aluminum wheel value stream for the week were 15,000. The following costs were incurred: Salaries/ Materials Wages Machining Other Total Cost Order processing $18,600 $18,600 Production planning 167,400 167,400 Purchasing 22,500 22,500 Stamping $370,000 37,000 $36,200 $18,200 461,400 Welding 160,000 41,000 41,000 12,000 254,000 Cladding 215,000 215,000 Testing 10,000 10,000 Packaging and shipping 8,000 8,000 Invoicing 13,000 13,000 Total $745,000 $317,500 $77,200 $30,200 $1,169,900 Required: 1. Assume initially that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost. Round your answer to the nearest dollar amount. per unit 2. Model A is responsible for 40 percent of the materials cost. Using the average conversion cost approach, calculate the unit cost for Models A and B. Round your answers to the nearest dollar amount. Unit Cost Model A Model B
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