MANAGERIAL ACCOUNTING LL W/ CONNECT
17th Edition
ISBN: 9781266675409
Author: Garrison
Publisher: MCG
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Chapter 7.A, Problem 4P
PROBLEM 7A-4 Time-Driven Activity-Based Costing LO 7-6, LO 7-7
Stahl Company is conducting a time-driven activity-based costing study in its Shipping Department. To aid the study, the company provided the following data regarding its Shipping Department and the customers served by the department:
| Customer L | Customer M | Customer N | All Customers |
|
| Number of line items picked | .. 280 | 160 | 90 | 335,000 |
| Number of boxes packaged | .. 50 |
20 | 15 | 46,800 |
| Number of deliveries loaded | .. 6 | 2 | 10 | 12,100 |
Required:
- Using the customer cost analysis shown in Exhibit 7A-2 as your guide, compute the following:
- The cost per minute of the resource supplied in the Shipping Department.
- The time-driven activity rate for each of Stahl's three activities.
- The total labor costs consumed by Customer L. Customer M. and Customer N.
- Using the capacity analysis shown in Exhibit 7A-3 as your guide, compute the following:
- The used capacity in minutes.
- The unused capacity in minutes.
- The unused capacity in number of employees. (Do not round your answer to a whole number.)
- The impact on expenses of matching capacity with demand. (Be sure to round your potential adjustment in the number of employees to a whole number.)
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Question 3 Part I Advent Corporation has implemented an Activity Based Costing System. The company wants to useABC on its two main products, V1 and V2, and three main activities as follows:ActivityCost Driver Overhead Amount Total Driver VolumeIssuing Purchase Orders # of Purchase Orders $ 150,000 50,000Reviewing Receiving Reports # of Receiving Reports $ 175,000 20,000Making Phone Calls # of Phone Calls $ 450,000 100,000During the year:Product V1 required 150 purchase orders; 150 receiving reports; and 200 phone calls.Product V2 required100 purchase orders; 400 receiving reports; and 350 phone calls.
Required:a. Compute the pre-determined overhead rate for each cost pool. b. Compute the total manufacturing overhead cost for Product V1 and Product V2.
Give true answer this accounting question please do fast
Overhead assigned to KL37?
Chapter 7 Solutions
MANAGERIAL ACCOUNTING LL W/ CONNECT
Ch. 7.A - EXERCISE 7A-1 Time-Driven Activity-Based Costing...Ch. 7.A -
EXERCISE 7A-2 Time-Driven Activity-Based Costing...Ch. 7.A - EXERCISE 7A-3 Time-Driven Activity-Based Costing...Ch. 7.A - PROBLEM 7A-4 Time-Driven Activity-Based Costing LO...Ch. 7.A - PROBLEM 7A-5 Time-Driven Activity-Based Costing LO...Ch. 7 - Prob. 1QCh. 7 - Prob. 2QCh. 7 - Prob. 3QCh. 7 - What are unit-level, batch-level, product-level,...Ch. 7 - What types of costs should not be assigned to...
Ch. 7 - What are the two stages off allocation in...Ch. 7 - Why is the first stage of the allocation process...Ch. 7 - When activity-based costing is used, why do...Ch. 7 - Prob. 9QCh. 7 - Why is the form of activity-based costing...Ch. 7 - The Excel worksheet form that appears below is to...Ch. 7 - Prob. 2AECh. 7 - The Excel worksheet form that appears below is to...Ch. 7 - Prob. 1F15Ch. 7 - Prob. 2F15Ch. 7 - Prob. 3F15Ch. 7 - Prob. 4F15Ch. 7 - Prob. 5F15Ch. 7 - Prob. 6F15Ch. 7 - Prob. 7F15Ch. 7 - Prob. 8F15Ch. 7 - Prob. 9F15Ch. 7 - Prob. 10F15Ch. 7 - Prob. 11F15Ch. 7 - Prob. 12F15Ch. 7 - Prob. 13F15Ch. 7 - Prob. 14F15Ch. 7 - Prob. 15F15Ch. 7 - Prob. 1ECh. 7 - Prob. 2ECh. 7 - Prob. 3ECh. 7 - Prob. 4ECh. 7 - Prob. 5ECh. 7 - Prob. 6ECh. 7 - EXERCISE 7-7 First-Stage Allocations LO7-2
The...Ch. 7 - Prob. 8ECh. 7 - Prob. 9ECh. 7 - Prob. 10ECh. 7 - Prob. 11ECh. 7 - Prob. 12ECh. 7 - EXERCISE 7-13 Computing ABC Product Costs LO7-3,...Ch. 7 - Prob. 14ECh. 7 - Prob. 15ECh. 7 - Prob. 16PCh. 7 - Prob. 17PCh. 7 - Prob. 18PCh. 7 - Prob. 19PCh. 7 -
PROBLEM 7-20 Evaluating the Profitability of...
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- 5arrow_forwardVishnuarrow_forwardPart 3: Activity-Based Costing Similarly, Mr. Suncat has a couple of questions for you regarding the activity-based costing method. He has provided the following additional information: Cost Pools Initial customer meeting Purchasing ingredients Cost Drivers Number of hours spent with customer Number of purchase requisitions Direct Labor hours Estimated Overhead $15,000 $15,000 $40,000 $70,000 3. Custom Wedding Cake Expected Use of Cost Drivers 4.5 hours $10,000 1000 requisitions 5.5 hours 9.5 hours Expected Use of Cost Driver: Basic Wedding Cake 0.75 hour Making and baking the wedding cakes Decorating the wedding cakes Final customer Direct Labor hours Number of meeting and cake wedding cakes delivery a. Explain the difference between a job-order costing system and an activity-based costing system. 4200 150 requisitions 1.25 hour 1.75 hours Expected Use of Cost Driver Multi-Layer Wedding Cake 1.25 hours 1500 cakes 300 requisitions 2 hours 3 hours Expected Use of Cost 1700 cakes Driver…arrow_forward
- MTI makes three types of lawn tractors: M3100, M4100, and M6100. In the past, it allocated overhead to products using machine-hours. Last year, the company produced 8,000 units of M3100, 17,500 units of M4100, and 10,000 units of M6100 and had the following revenues and costs: Sales revenue Direct costs Direct materials Direct labor Variable overhead Setting up machines Processing sales orders Warehousing Operating machines Shipping Contribution margin Plant administration Gross profit MTI Activity Setting up machines Processing sales orders Warehousing Operating machines. Income Statement M3100 $ 9,400,000 3,300,000 610,000 M4100 $ 15,700,000 Cost Driver Production runs 4, 800, 800 860, 000 M6100 $ 14,200,000 Sales orders received Units held in inventory Machine-hours 3,100,000 1,730, 000 MTI's controller has heard about activity-based costing and puts together an employee team to recommend cost allocation bases. The employee team recommends the following. M3100 9 170 90 6, 200 Total…arrow_forwardPlease answer all partsarrow_forwardI Problem 5-65 Customer-Profitability Analy- sis, Activity-Based Costing (LO 5-9) Fresno Fiber Optics, Inc. manufactures fiber optic cables for the computer and telecommunications industries. At the request of the company vice president of marketing, the cost management staff has recently completed a customer-profitability study. The following activity-based costing information was the basis for the analysis. 1. Operating income, Trace Telecom: $7,000 Chapter 5 ActivtyBased Costing and Management 225 Customer-Related Activities Cost Driver Base Cost Driver Rate Sales activity Sales visits $1,000 Order taking Purchese orders 200 Units handied. Special handing - Special shipping 50 Shipments 500 Cost-driver data for two of Fresno's customers for the most recent year are Customer-Related Activities Trace Telecom Caltex Computer 8 visits 6 vists Sales activity. Order taking 15 orders 20 orders Special handing. 800 units handled. 600 unts handled Special shipping 18 shipments 20 shipments…arrow_forward
- Problem 2 Milky Corporation has provided the following data from its activity-based costing accounting system: Activity Cost Pools Designing products Setting up batches Assembling products Total Cost P1,372,448 P33,300 P126,160 Total Activity 7,798 product design hours 740 batch set-ups 6,640 assembly hours The activity rate for the "designing products" activity cost pool is answer must be in nearest peso A The activity rate for the "setting up batches" activity cost pool is answer should be in nearest peso A The activity rate for the "assembling products" activity cost pool is answer must be in nearest peso Aarrow_forwardSolve general accounting questionarrow_forwardNeed help pleasearrow_forward
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