The Alright Manufacturing Company in Rochester, Minnesota, assembles and tests electronic components used in smartphones. Consider the

Question:

The Alright Manufacturing Company in Rochester, Minnesota, assembles and tests electronic components used in smartphones. Consider the following data regarding component T24 (amounts are per unit): 

Direct materials cost........................................... $ 80.00 

Direct labor cost.......................................................20.00

Activity-based costs allocated......................................?

Total manufacturing product cost ...........................  ?

The activities required to build the component follow: 


Requirements 

1. Complete the missing items for the two tables. 

2. Why might managers favor this ABC system instead of Alright’s older system, which allocated all manufacturing overhead costs on the basis of direct labor hours?

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Related Book For  book-img-for-question

Horngrens Financial And Managerial Accounting

ISBN: 9780134486833

6th Edition

Authors: Tracie Miller Nobles, Brenda Mattison, Ella Mae Matsumura

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