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abc costing QUESTION 4 Xsports is a manufacturer of high-quality footballs and soccer balls. Setup costs are driven by the number of batches. Equipment and
abc costing
QUESTION 4 Xsports is a manufacturer of high-quality footballs and soccer balls. Setup costs are driven by the number of batches. Equipment and maintenance costs increase with the number of machine-hours, and lease rent is paid per square foot. The capacity of the facility is 15000 square feet and Xsports is using 80% of this capacity. Xsports records the cost of unused capacity as a separate line ftem and not as a product cost. Below is the budgeted information for Xsports for the year ended September 30, 2019: Direct Materials footballs $218500 Direct Materials soccer balls $364350 Direct manuf. labor footballs $112425 Direct manuf, labor soccer balls $109625 Setup costs $146500 Equipment and maintenance $118600 Lease rent $224000 TOTAL $1294000 Other information: Footballs Soccer balls 108000 Number of balls 72000 Machine Hours 14000 Number of batches 400 Square footage of production space used 4540 15500 500 7460 Click Save and Submit to save and submit. Click Save All Answers to save all answers. Save All Answer Lease rent TOTAL $224000 $1294000 Other information: Footballs Soccer balls 108000 Number of balls 72000 Machine Hours 14000 Number of batches 400 Square footage of production space used 4540 15500 500 7460 1. Calculate the cost per unit of cost driver for each indirect cost pool 2. What is the cost unused capacity? 3. What are the total cost and the cost per unit of resources used to produce (a) footballs and (b) soccer balls? 4. What factors should Xsport consider if it has the opportunity to manufacture a new line of volleyballs? Attach File Browse My Computer Step by Step Solution
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