Fanning Industries produces two electronic decoders, P and Q. Decoder P is more sophisticated and requires...
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Fanning Industries produces two electronic decoders, P and Q. Decoder P is more sophisticated and requires more programming and testing than does Decoder Q. Because of these product differences, the company wants to use activity-based costing to allocate overhead costs. It has identified four activity pools. Relevant information follows: Activity Pools Repair and maintenance on assembly machine Programming cost Software inspections Product testing Total overhead cost Expected activity for each product follows: Cost Pool Total $ 68,900 99,200 Cost Driver Number of units produced Number of programming hours 6,510 Number of inspections 11,780 Number of tests $186,390 Number of Number of Programming Number of Number of Units Hours Inspections Tests Decoder P 16,000 1,700 194 1,300 Decoder Q 37,000 2,300 116 1,800 Total 53,000 4,000 310 3,100 Required a. Compute the overhead rate for each activity pool. b. Determine the overhead cost allocated to each product. Complete this question by entering your answers in the tabs below. Required A Required B Compute the overhead rate for each activity pool. (Round your answers to 2 decimal places.) Activity Pools Repair and maintenance on assembly machine Programming cost Software inspections Product testing Allocation Rate Required A Required B > Complete this question by entering your answers in the tabs below. Required A Required B Determine the overhead cost allocated to each product. (Round intermediate calculations to 2 decimal places.) Total Allocated Cost Decoder P Decoder Q < Required A Required B > Fanning Industries produces two electronic decoders, P and Q. Decoder P is more sophisticated and requires more programming and testing than does Decoder Q. Because of these product differences, the company wants to use activity-based costing to allocate overhead costs. It has identified four activity pools. Relevant information follows: Activity Pools Repair and maintenance on assembly machine Programming cost Software inspections Product testing Total overhead cost Expected activity for each product follows: Cost Pool Total $ 68,900 99,200 Cost Driver Number of units produced Number of programming hours 6,510 Number of inspections 11,780 Number of tests $186,390 Number of Number of Programming Number of Number of Units Hours Inspections Tests Decoder P 16,000 1,700 194 1,300 Decoder Q 37,000 2,300 116 1,800 Total 53,000 4,000 310 3,100 Required a. Compute the overhead rate for each activity pool. b. Determine the overhead cost allocated to each product. Complete this question by entering your answers in the tabs below. Required A Required B Compute the overhead rate for each activity pool. (Round your answers to 2 decimal places.) Activity Pools Repair and maintenance on assembly machine Programming cost Software inspections Product testing Allocation Rate Required A Required B > Complete this question by entering your answers in the tabs below. Required A Required B Determine the overhead cost allocated to each product. (Round intermediate calculations to 2 decimal places.) Total Allocated Cost Decoder P Decoder Q < Required A Required B >
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a Overhead Rate for Each Activity Pool 1 Repair and Maintenance on Assembly Machine Overhead Rate Co... View the full answer
Related Book For
Fundamental Managerial Accounting Concepts
ISBN: 978-0078025655
7th edition
Authors: Thomas Edmonds, Christopher Edmonds, Bor Yi Tsay, Philip Old
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