Ellis Perry is an electronics components manufacturer. Information about the company’s two products follows: AM-2 FM-9 Units produced 20,000 4,000 Direct labor hours required for production 10,000 15,000 Units per batch 4,000 400 Shipping weight per unit 0.50lbs.10lbs.The company incurs $840,000 in overhead per year and has traditionally applied overhead on the basis of direct labor hours.(a) Correct answer iconYour answer is correct.(i)How much overhead will be allocated to each product using the traditional direct labor hours allocation base? (Round per unit rates to 2 decimal places, e.g. 3.54 and final answers to 0 decimal places, e.g. 45,286.) AM-2FM-9 Overhead allocated to each product $enter a dollar amount rounded to 0 decimal places$enter a dollar amount rounded to 0 decimal places(ii)What overhead cost per unit will be allocated to each product? (Round answers to 2 decimal places, e.g. 15.25.) AM-2FM-9 Overhead cost per unit $enter a dollar amount rounded to 2 decimal places$enter a dollar amount rounded to 2 decimal places eTextbook and MediaAssistance Used Attempts: unlimited (b) Assume that Ellis Perry has identified three activity cost pools.Pool Cost Cost Driver Assembly $630,000 Direct labor hours Setup 30,000 Number of setups (1 per batch) Packaging 180,000 (i)Given these activity pools and cost drivers, how much overhead should be allocated to each product? (Round per unit rates to 2 decimal places, e.g. 3.54 and final answers to 0 decimal places, e.g. 45,286.)

Name: Ellis Perry is an electronics components manufacturer. Information abo
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Description: Ellis Perry is an electronics components manufacturer. Information about the company’s two products follows: AM-2 FM-9 Units produced 20,000 4,000 Direct labor hours required for production 10,000 15,000 Units per batch 4,000 400 Shipping weight per

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Answered: Ellis Perry is an electronics…

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter10: Standard Costing And Variance Analysis

Section: Chapter Questions

Problem 76P: Shumaker Company manufactures a line of high-top basketball shoes. At the beginning of the year, the...

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	AM-2		FM-9
Units produced	20,000		4,000
Direct labor hours required for production	10,000		15,000
Units per batch	4,000		400
Shipping weight per unit	0.50	lbs.	10	lbs.

(a)

Correct answer icon

Your answer is correct.

(i)

How much overhead will be allocated to each product using the traditional direct labor hours allocation base? (Round per unit rates to 2 decimal places, e.g. 3.54 and final answers to 0 decimal places, e.g. 45,286.)

		AM-2	FM-9
Overhead allocated to each product		$enter a dollar amount rounded to 0 decimal places	$enter a dollar amount rounded to 0 decimal places

(ii)

What overhead cost per unit will be allocated to each product? (Round answers to 2 decimal places, e.g. 15.25.)

		AM-2	FM-9
Overhead cost per unit		$enter a dollar amount rounded to 2 decimal places	$enter a dollar amount rounded to 2 decimal places

eTextbook and Media

Assistance Used

Attempts: unlimited

(b)

Assume that Ellis Perry has identified three activity cost pools.

Pool	Cost	Cost Driver
Assembly	$630,000	Direct labor hours
Setup	30,000	Number of setups (1 per batch)
Packaging	180,000	(i)	Given these activity pools and cost drivers, how much overhead should be allocated to each product? (Round per unit rates to 2 decimal places, e.g. 3.54 and final answers to 0 decimal places, e.g. 45,286.)

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