Two-Stage ABC for Manufacturing Detroit Foundry, a large manufacturer of heavy equipment components, has determined the following activity cost pools and cost driver levels for the year: Activity Cost Driver 12,000 setup hours 2,000 tons of materials 10,000 machine hours Activity Cost Pool Activity Cost Machine setup $ 660,000 Material handling 100,000 Machine operation 450,000 The following data are for the production of single batches of two products, C23 Cams and U2 Shafts: C23 Cams U2 Shafts 500 300 4 200 5 400 $10,000 $5,000 $30,000 $ 20,000 Units produced Machine hours Direct labor hours Direct labor cost Direct materials cost Tons of materials Setup hours 12.5 3 U2 Shafts 8 7 Determine the unit costs of C23 Cams and U2 Shafts using ABC. (Round answers to the nearest cent.) C23 Cams

Two-Stage ABC for Manufacturing Detroit Foundry, a large manufacturer of heavy equipment components, has determined the following activity cost pools and cost driver levels for the year: Activity Cost Driver 12,000 setup hours 2,000 tons of materials 10,000 machine hours Activity Cost Pool Activity Cost Machine setup $ 660,000 Material handling 100,000 Machine operation 450,000 The following data are for the production of single batches of two products, C23 Cams and U2 Shafts: C23 Cams U2 Shafts 500 300 4 200 5 400 $10,000 $5,000 $30,000 $ 20,000 Units produced Machine hours Direct labor hours Direct labor cost Direct materials cost Tons of materials Setup hours 12.5 3 U2 Shafts 8 7 Determine the unit costs of C23 Cams and U2 Shafts using ABC. (Round answers to the nearest cent.) C23 Cams

Name: PLEASE HELP AND ANSWER IN TEXT FORM WITH ALL WORK IN STEPS Two-Stage A
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Description: PLEASE HELP AND ANSWER IN TEXT FORM WITH ALL WORK IN STEPS Two-Stage ABC for ManufacturingDetroit Foundry, a large manufacturer of heavy equipment components, has determined the following activity cost pools and cost driver levels for the year:Activi

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter4: Activity-based Costing

Section: Chapter Questions

Problem 27E: Plata Company has identified the following overhead activities, costs, and activity drivers for the...

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Patterson Company produces wafers for integrated circuits. Data for the most recent year are provided: aCalculated using number of dies as the single unit-level driver. bCalculated by multiplying the consumption ratio of each product by the cost of each activity. Required: 1. Using the five most expensive activities, calculate the overhead cost assigned to each product. Assume that the costs of the other activities are assigned in proportion to the cost of the five activities. 2. Calculate the error relative to the fully specified ABC product cost and comment on the outcome. 3. What if activities 1, 2, 5, and 8 each had a cost of 650,000 and the remaining activities had a cost of 50,000? Calculate the cost assigned to Wafer A by a fully specified ABC system and then by an approximately relevant ABC approach. Comment on the implications for the approximately relevant approach.
During the week of May 10, Hyrum Manufacturing produced and shipped 16,000 units of its aluminum wheels: 4,000 units of Model A and 12,000 units of Model B. The cycle time for Model A is 1.09 hours and for Model B is 0.47 hour. The following costs and production hours were incurred: Required: 1. Assume that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost, and comment on its accuracy. 2. Assume that Model A is responsible for 40% of the materials cost. Calculate the unit cost for Models A and B, and comment on its accuracy. Explain the rationale for using units shipped instead of units produced in the calculation. 3. Calculate the unit cost for the two models, using DBC. Explain when and why this cost is more accurate than the unit cost calculated in Requirement 2.
During the week of August 21, Parley Manufacturing produced and shipped 4,000 units of its machine tools: 1,500 units of Tool SK1 and 2,500 units of Tool SK3. The cycle time for SK1 is 0.73 hour, and the cycle time for SK3 is 0.56 hour. The following costs were incurred: Required: 1. Assume that the value-stream costs and total units shipped apply only to one model (a single-product value stream). Calculate the unit cost, and comment on its accuracy. 2. Assume that Tool SK1 is responsible for 60% of the materials cost. Calculate the unit cost for Tool SK 1 and Tool SK3, and comment on its accuracy. Explain the rationale for using units shipped instead of units produced in the calculation. 3. Calculate the unit cost for the two models, using DBC. Explain when and why this cost is more accurate than the unit cost calculated in Requirement 2.
Z Co.manufactures thr sting, has identified five activities (and related cost drivers). Each activity, its identified below. Activlty Cost Cost Driver Material handling $225,000 Number of parts Material insertion 2,475,000 Number of parts Automated machinery 840,000 Machine hours Finishing 170,000 Direct labor hours Packaging 170,000 Orders shipped Total $3.880.000 The following information pertains to the three product lines for next year: Y Units to be produced 10,000 5,000 2,000 Orders to be shipped 1,000 500 200 Number of parts per unit 10 15 25 Machine hours per unit 1 3 Labor hours per unit 2 2 2 Under an activity-based costing system, what is the per-unit overhead cost of Y? pe here to search acer 立

Assume Sherwin-Williams Company, a large paint manufacturer, has determined the following activity cost pools and cost driver levels for the latest period: Activity Cost Pool Activity Cost Activity Cost Driver Machine setup $960,000 2,500 setup hours Material handling 830,000 5,000 material moves Machine operation 200,000 20,000 machine hours The following data are for the production of single batches of two products, Mirlite and Subdue: Mirlite Subdue Gallons produced 50,000 30,000 Direct labor hours 400 250 Machine hours 800 250 Direct labor cost $9,500 $7,000 Direct materials cost $360,000 $160,000 Setup hours 15 12 Material moves 60 35 Determine the batch and unit costs per gallon of Mirlite and Subdue using ABC.Round cost per gallon to two decimal places. Product Costs Mirlite Subdue Direct materials Answer Answer Direct labor Answer Answer Manufacturing overhead: Machine setups Answer Answer Material…
Two-Stage ABC for Manufacturing Columbus Foundry, a large manufacturer of heavy equipment components, has determined the following activity cost pools and cost driver levels for the year: Activity cost pool Activity cost Activity cost driver Machine setup $600,000 12,000 setup hours Material handling 180,000 2,000 tons of materials Machine operation 500,000 10,000 machine hours The following data are for the production of single batches of two products, C23 Cams and U2 Shafts: C23 Cams U2 Shafts Units produced 500 200 Machine hours 5 Direct labor hours 400 500 Direct labor cost $5,000 $10,000 Direct materials cost $30,000 $20,000 Tons of materials 12.5 8 Setup hours 4 Determine the unit costs of C23 Cams and U2 Shafts using ABC. C23 Cams $ 0 U2 Shafts $ 0
Two-Stage ABC for ManufacturingAssume Sherwin-Williams Company, a large paint manufacturer, has determined the following activity cost pools and cost driver levels for the latest period: Activity Cost Pool Activity Cost Activity Cost Driver Machine setup $1,000,000 2,500 setup hours Material handling 870,000 5,000 material moves Machine operation 200,000 20,000 machine hours The following data are for the production of single batches of two products, Mirlite and Subdue: Mirlite Subdue Gallons produced 50,000 30,000 Direct labor hours 400 250 Machine hours 800 250 Direct labor cost $11,000 $8,500 Direct materials cost $400,000 $200,000 Setup hours 15 12 Material moves 60 35 Determine the batch and unit costs per gallon of Mirlite and Subdue using ABC.Round cost per gallon to two decimal places. Product Costs Mirlite Subdue Direct materials Direct labor Manufacturing overhead: Machine setups…
Pronghorn Industries has three activity cost pools and two products. It estimates production 2,000 units of Product BC113 and 1,000 of Product AD908. Having identified its activity cost pools and the cost drivers for each pool, Pronghorn accumulated the following data relative to those activity cost pools and cost drivers. Activity Cost Pools Machine setup Machining Packing (a) Annual Overhead Data Activity Cost Pools Machine setup Using the above data, do the following: Machining Packing Cost Drivers $ Setups $ Machine hours Orders Estimated Overhead Estimated Overhead $17,500 120,750 28,670 Use of Cost Drivers per Product Estimated Use of Cost Drivers per Activity 35 Prepare a schedule showing the computations of the activity-based overhead rates per cost driver. 4,830 470 Estimated Use of Cost Drivers per Activity setups machine hours Product BC113 orders 20 1,140 120 $ $ $ Product AD908 15 3,690 350 Activity-Based Overhead Rates per setup per machine hr. per order
Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Expected Cost Activity Driver Activity Capacity $138,000 Number of setups 10,200 Number of orders 92,400 Machine hours 18,480 Receiving hours phones with the following expected activity demands: Setting up equipment Ordering materials Machining Receiving Silven produces two models of cell Model X 5,000 80 200 6,600 385 Units completed Number of setups Number of orders Machine hours Receiving hours Required: Model Y 10,000 40 400 4,950 770 120 600 11,550 1,155
Casey Company has five activity cost pools and two products. It expects to produce 200,000 units of its automobile scissors jack and 80,000 units of its truck hydraulic jack. Having identified its activity cost pools and the cost drivers for each cost pool, Casey Company accumulated the following data relative to those activity cost pools and cost drivers. Expected Use of Cost Drivers per Product Hydraulic Jacks Annual Overhead Data Expected Use of Cost Drivers per Activity Estimated Scissors Activity Cost Pools Ordering and receiving Machine setup Machining Assembling Inspecting and testing Cost Drivers Overhead Jacks $ 200,000 600,000 2,000,000 1,800,000 700,000 2,500 orders 1,200 setups 800,000 hours 1,500 700 500,000 1,200,000 15,000 Purchase orders 1,000 Setups Machine hours 500 Parts Tests 3,000,000 parts 35,000 tests 300,000 1,800,000 20,000 $5,300,000 Required: Using ABC Calculate Per Unit and Total cost of Both Products also Comment?
Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: activity expected cost activity drivers activity capacity setting up equipment 126,000 number of setups 150 ordering material 18,000 number of orders 900 machining 126,000 machine hours 10,500 receiving 30,000 receiving hours 1,250 Silven produces two models of cell phones with the following expected activity demands: model x model y units completed 5,000 10000 number of setups 100 50 number of orders 300 600 machine hours 6000 4500 receiving hours 375 875 Required:1. Calculate the global consumption ratios for the two products.2. Using the activity consumption ratios for number of orders and number of setups, show that the same cost assignment can be achieved using these two drivers as that of the complete, four-driver ABC system.
Merone Company allocates materials handling cost to the company's two products using the below data Modular Homes Total expected units produced Total expected material moves 6,000 600 Expected direct labor-hours per unit 800 The total materials handling cost for the year is expected to be $300,000. If the materials handling cost is allocated on the basis of material moves, the total materials handling cost allocated to the modular homes is closest to: (Round your intermediate calculations to 2 decimal places.) Prefab Barns 9,000 200 300