Q2) Deep Manufacturers information is provided for the production of two product lines named as pen and pencil of a Deep manufacturers. Activity Setup Cost (OMR) 250,000 Machine maintenance 75,000 Total indirect manufacturing costs 325,000 Particulars Product- pen Product- pencil Total( OMR) Direct labor hours 7000 3000 10,000 Number of setups Number of machine hours 1,200 70 30 100 3,800 5,000 The Deep manufactures plans to produce 500 units of pens and 1000 units of pencils. Compute the activity based cost per unit of each product.

Q2) Deep Manufacturers information is provided for the production of two product lines named as pen and pencil of a Deep manufacturers. Activity Setup Cost (OMR) 250,000 Machine maintenance 75,000 Total indirect manufacturing costs 325,000 Particulars Product- pen Product- pencil Total( OMR) Direct labor hours 7000 3000 10,000 Number of setups Number of machine hours 1,200 70 30 100 3,800 5,000 The Deep manufactures plans to produce 500 units of pens and 1000 units of pencils. Compute the activity based cost per unit of each product.

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter5: Process Costing

Section: Chapter Questions

Problem 2PB: The following product costs are available for Kellee Company on the production of eyeglass frames:...

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Production run size and activity improvement Littlejohn, Inc. manufactures machined parts for the automotive industry. The activity cost associated with Part XX-10 is as follows: Activity Activity-Base Usage Activity Rate = Activity Cost Fabrication 250 dlh 80per dlh 20,000 Setup 10 setups 80 per setup 800 Production control 10 prod, runs 30 per prod, run 300 Moving 10 moves 25 per move 250 Total activity cost per unit 21,350 Estimated units of production 500 Activity cost per unit 42.70 Each unit requires 30 minutes of fabrication direct labor. Moreover, part XX-10 is manufactured in production run sizes of 50 units. Each production run is set up, scheduled (production control), and moved as a batch of 50 units. Management is considering improvements in the setup, production control, and moving activities in order to cut the production run sizes by half. As a result, the number of setups, production runs, and mows will double from 10 to 20. Such improvements are expected to speed the companys ability to respond to customer orders. Setup is reengineered so that it takes 60% of the original cost per setup. Production control software will allow production control effort and cost per production run to decline by 60%. Moving distance was reduced by 40%, thus reducing the cost per mow by the same amount. A. Determine the revised activity cost per unit under the proposed changes. B. Did these improvements reduce the activity cost per unit? C. What cost per unit for setup would be required for the solution in (A) to equal the base solution?
A production department within a company received materials of $7,000 and conversion costs of $5,000 from the prior department. It added material of $78400 and conversion costs of $47000. The equivalent units are 5,000 for material and 4,000 for conversion. What is the unit cost for materials and conversion?
The following product costs are available for Kellee Company on the production of eyeglass frames: direct materials, $32,125; direct labor, $23.50; manufacturing overhead, applied at 225% of direct labor cost; selling expenses, $22,225; and administrative expenses, $31,125. The direct labor hours worked for the month are 3,200 hours. A. What are the prime costs? B. What are the conversion costs? C. What is the total product cost? D. What is the total period cost? E. If 6.425 equivalent units are produced, what is the equivalent material cost per unit? F. What is the equivalent conversion cost per unit?
For E2-17, prepare any journal entries that would have been different if the only trigger points had been the purchase of materials and the sale of finished goods. 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.)
What is the conversion cost to manufacture insulated travel cups if the costs are: direct materials, $17,000; direct labor, $33,000; and manufacturing overhead, $70,000? A. $16,000 B. $50,000 C. $103,000 D. $120000
The following product costs are available for Stellis Company on the production of erasers: direct materials, $22,000; direct labor, $35,000; manufacturing overhead, $17,500; selling expenses, $17,600; and administrative expenses; $13,400. What are the prime costs? What are the conversion costs? What is the total product cost? What is the total period cost? If 13,750 equivalent units are produced, what is the equivalent material cost per unit? If 17,500 equivalent units are produced, what is the equivalent conversion cost per unit?
The following product Costs are available for Haworth Company on the production of chairs: direct materials, $15,500; direct labor, $22.000; manufacturing overhead, $16.500; selling expenses, $6,900; and administrative expenses, $15,200. What are the prime costs? What are the conversion costs? What is the total product cost? What is the total period cost? If 7,750 equivalent units are produced, what is the equivalent material cost per unit? If 22,000 equivalent units are produced, what is the equivalent conversion cost per unit?
(B) The following information is provided for the production of two product lines named as pen and pencil of a Deep corporation. Activity Cost (OMR) Setup 250,000 Machine maintenance 75,000 Total indirect manufacturing costs 325,000 Product- pen Product- pencil Total( OMR) Direct labor hours 7000 3000 10,000 Number of setups 70 30 100 Number of machine hours 1,200 3,800 5,000 The Deep Corporation plans to produce 500 units of pens and 1000 units of pencils. Compute the activity based cost per unit of each product.
All applicable Mini-Exercises are available with McGraw-Hill’s Connect™Accounting. Total manufacturing costs Acme, Inc., incurs the following costs during May: accounting Mini-Exercise 13.1LO 3, 4 Sales expense. . . . . . . . . . . . . . . . $11,500Direct labor . . . . . . . . . . . . . . . . . . 26,000Factory supplies . . . . . . . . . . . . . . 2,500Advertising . . . . . . . . . . . . . . . . . . 2,800Raw material used . . . . . . . . . . . . 18,000Administrative expense . . . . . . . $ 21,500Plant depreciation . . . . . . . . . . . 6,200Indirect labor. . . . . . . . . . . . . . . 8,000Utilities . . . . . . . . . . . . . . . . . . . . 10,000 **75% of this amount relates to the factory.Required:Calculate Acme’s total manufacturing costs for May.
The following information is derived from the cost sheet of Al Hood Manufacturing & Trading LLC: Manufacturing overhead                     RO 5,000 Selling & Distribution overhead        RO 2,000 Direct material                                    RO 10,000 Direct expenses                                   RO 4,000 Administration overheads                   RO 1,000 Direct labor                                         RO 3,000 Use the above information and answer 29, 30 and 31 MCQs Calculate the amount of conversion cost that is incurred for Al Hood Manufacturing & Trading LLC. a. RO 22,000 b. RO 25,000 c. RO 8,000 d. RO 23,000
he following information is derived from the cost sheet of Al Hood Manufacturing & Trading LLC: Manufacturing overhead                     RO 5,000 Selling & Distribution overhead        RO 2,000 Direct material                                    RO 10,000 Direct expenses                                   RO 4,000 Administration overheads                   RO 1,000 Direct labor                                         RO 3,000 Use the above information and answer 30 MCQs 30. Calculate the amount of conversion cost that is incurred for Al Hood Manufacturing & Trading LLC. a.RO 25,000 b.RO 23,000 c.RO 22,000 d.RO 8,000
Manufacturing Company produces special kitchen utensils using the JIT system.   Transactions for the current period are as follow:a.       Raw materials purchased, P1,950,000b.      Direct labor costs of P2,500,000 were incurred.c.       Actual overhead costs of P3,500,000 were incurred.d.      Conversion costs are directly charged to cost of sales.e.       Finished goods, end amounted to P420,000 of which P200,000 is materials.f.       Finished goods, beg amounted to P600,000 of which P350,000 is materialsg.       RIPI, beginning P850,000, of which materials is P600,000.h.      RIPI, ending P750,000, of which materials is P500,000.The cost of sales for the period amounted to:a. P8,230,000 b. P8,200,000 c. P8,130,000 d. P8,000,000