1. Classify each activity as unit level ( U ) , batch level ( B ) , product level ( P ) , or facility level ( F ) . Chapter 17 Activity Based Costing and Analysis 6 Following are activities in providing medical services at Healthsmart Clinic A. Registering patients E. Ordering medical equipment B. Cleaning beds F. Heating the clinic C. Stacking examination rooms G. Providing security services D. Washing linens H. Filling prescriptions (los and weise 17-18 Re 1 Required 2. Identify an activity driver that might be used to measure these activities at the clinic connect The following data are for the two products produced by Tadros Company OBLEM SET A Product A Product B wiem 17-1A costs using the partide P3 A1 A2 Direct materials Direct labor hours. Machine hours Batches Volume ....* Engineering modifications Number of customers. Market price... $15 per unit 0.3 DLH per unit 0.1 MH per unit 125 batches 10,000 units 12 modifications 500 customers $30 per unit $24 per unit 1.6 DLH per unit 1.2 MH per unit 225 batches 2,000 units 58 modifications 400 customers $120 per unit The company's direct labor rate is $20 per direct labor hour (DLH). Additional information follows. Costs Driver Indirect manufacturing Engineering support Electricity... Setup costs Nonmanufacturing Customer service $24,500 34,000 52,500 Engineering modifications Machine hours Batches 81,000 Number of customers Product un cost comparison? Product A unit cost per unit? Required 1. Compute the manufacturing cost per unit using the plantwide overhead rate based on direct labor hours. What is the gross profit per unit? 2. How much gross profit is generated by each customer of Product A using the plantwide overhead rate How much gross profit is generated by each customer of Product B using the plantwide overhead rate? What is the cost of providing customer service to each customer? What information is provided by this 3. Determine the manufacturing cost per unit of each product line using ABC. What is the gross profil 4. How much gross profit is generated by each customer of Product A using ABC? How much grosor profit is generated by each customer of Product B using ABC? Is the gross profit per customer adequate? 5. Which method of product costing gives better information to managers of this company? Explain why Xylon Company manufactures custom-made furniture for its local market and 17-2A mpacts of using furnishings sold in retail af home equired Assign these three overhead cost pools to each of the two products using ABC. Determine average cost per foot for each of the two products using ABC. Compare the average cost per foot under ABC with the average cost per foot under the current melius for each product. Explain why a difference between the two cost allocation methods exists. cage and squared edge, on to se 17-14 -based costing Glassworks Inc. produces two types of glass shelving, duction line. For the current period, the company reports the following data." Rounded Edge Squared Edge Total $19,000 12,200 36,600 $67,800 10,500 ft. $ 6.46 Direct materials Direct labor. Overhead (300% of direct labor cost). Total cost. Quantity produced. Average cost per ft. (rounded). $ 43,200 23,800 71,400 $138,400 14,100 ft. $ 9.82 $62201 36000 108.000 $206.2016 Glassworks's controller wishes to apply activity-based costing (ABC) to allocate the $108.0 dts head costs incurred by the two product lines to see whether cost per foot would change markedly se reported above. She has collected the following information. Overhead Cost Category (Activity Cost Pool) Cost Supervision Depreciation of machinery.. Assembly line preparation.. Total overhead $ 5,400 56.600 46,000 $108.000 She has also collected the following information about the cost drivers for each category (cs pels the amount of each driver used by the two product lines. OL the amount of each driver used by the two product lines. Usage Overhead Cost Category (Activity Cost Pool) Driver Rounded Edge Squared Edge Direct labor cost ($) Machine hours Setups (number) Supervision Depreciation of machinery Assembly line preparation $12,200 500 hours 40 times $23,800 1,500 hours 210 times 2.000 She has also collected the following information about the cost drivers for each category (cost dela