Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

2nd question part 3 he Foundational 15 [LO7-1, LO7-3, LO7-4] [The following information applies to the questions displayed below.] Hickory Company manufactures two products13,000 units

2nd question part 3

he Foundational 15 [LO7-1, LO7-3, LO7-4]

[The following information applies to the questions displayed below.]

Hickory Company manufactures two products13,000 units of Product Y and 5,000 units of Product Z. The company uses a plantwide overhead rate based on direct labor-hours. It is considering implementing an activity-based costing (ABC) system that allocates all $684,000 of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products Y and Z:

Activity Cost Pool Activity Measure Estimated Overhead Cost Expected Activity
Machining Machine-hours $ 235,200 12,000 MHs
Machine setups Number of setups $ 73,600 160 setups
Product design Number of products $ 80,000 2 products
General factory Direct labor-hours $ 295,200 14,400 DLHs

Activity Measure Product Y Product Z
Machine-hours 6,600 5,400
Number of setups 40 120
Number of products 1 1
Direct labor-hours 7,600 6,800

9. Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Y? (Round all intermediate calculations to 2 decimal places.)

10. Using the ABC system, how much total manufacturing overhead cost would be assigned to Product Z?

11. Using the plantwide overhead rate, what percentage of the total overhead cost is allocated to Product Y and Product Z? (Round your "Percentage" answers to 2 decimal place.)

12. Using the ABC system, what percentage of the Machining costs is assigned to Product Y and Product Z? (Round your "Percentage" answers to 2 decimal places.)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Financial Accounting

Authors: John Hoggett, Lew Edwards, Evelyn Hogg, John Medlin, Matthew Tilling

8th Edition

1742466362, 978-1742466361

More Books

Students also viewed these Accounting questions