10 Snavely, Inc, manufactures and sels two products Product El and Product AZ Data conceming the expected productton of each product and the expected total direct labor hours (DH) requred to produce thatoutput appear belowTotalDirectDirectLabor-HoursExpectedProduction Per Unit1,100LaborHoursProduct E12.02,200Product A73001.0300Total direct labor-hours2,500The direct labor rate is $2110 per DLH The direct materials cost per unt for each product is given belowDirectMaterialsCost per UnitProduct E1$229.00Product A7$220.00The company has an activity based costing system wth the folowng actvey cost pooh, actvty measres and expected activityEstimatedtopected tivityActivityOverheadActivity Cost PoolsLabor-relatedProduct E1 Product A2,2001,200MeasuresCost$ 137,30064,730Total2,5001,500300Machine setupssetups3006,5001,012,420$1,214,450Order size2,8003,700The activity rate for the Order Sze activity cost pool under activity-based costing is closest to

Activity based costing: Activity based costing represents an approach of monitoring cost in…

ect labor hours or ate is $21510 per DH The drect materias cont per unt for each product g Direct Materials Cest per it $229.0 eeces has an actiy baed costng system wim 1acivty cat poo actve Estimeted Overteat tpectedtiity Activity Cest

ect labor hours or ate is $21510 per DH The drect materias cont per unt for each product g Direct Materials Cest per it $229.0 eeces has an actiy baed costng system wim 1acivty cat poo actve Estimeted Overteat tpectedtiity Activity Cest

Survey of Accounting (Accounting I)

8th Edition

ISBN:9781305961883

Author:Carl Warren

Publisher:Carl Warren

Chapter12: Differential Analysis And Product Pricing

Section: Chapter Questions

Problem 12.16E: Product cost concept of product pricing Based on the data presented in Exercise 12-15, assume that...

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Question

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Snavely, Inc, manufactures and sels two products Product El and Product AZ Data conceming the expected productton of each product and the expected total direct labor hours (DH) requred to produce that
output appear below
Total
Direct
Direct
Labor-Hours
Expected
Production Per Unit
1,100
Labor
Hours
Product E1
2.0
2,200
Product A7
300
1.0
300
Total direct labor-hours
2,500
The direct labor rate is $2110 per DLH The direct materials cost per unt for each product is given below
Direct
Materials
Cost per Unit
Product E1
$229.00
Product A7
$220.00
The company has an activity based costing system wth the folowng actvey cost pooh, actvty measres and expected activity
Estimated
topected tivity
Activity
Overhead
Activity Cost Pools
Labor-related
Product E1 Product A
2,200
1,200
Measures
Cost
$ 137,300
64,730
Total
2,500
1,500
300
Machine setups
setups
300
6,500
1,012,420
$1,214,450
Order size
2,800
3,700
The activity rate for the Order Sze activity cost pool under activity-based costing is closest to

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