Accounting! 1 Overhead? Mark each of the following as either Direct Labor or Overhead Direct Labor? Factory Janitor Salary Factory Receptionist Salary Factory Assembly Labor Salary Factory Cafeteria Labor Salary Factory Supervisory Management Salary d 2 N Company manufactures entry and dining room lighting fixtures N Company spent 5588,600 in overhead and $117.720 in direct labor costs last year a. Assume N Company uses traditional conventional) costing and applies overhead to products based on Direct Labor Dollars What is Company's one Overhead Application Rate? (Please label your answer clearly so many dollars per what?) b. The Direct Labor Dollars used by each of the two products is as follows Entry Dining Direct Labor Dollars S50,000 $67.720 Based on your answer to part 'a, how much overhead should be assigned to the Entry Light Fixtures under traditional costing? How much overhead should be assigned to the Dining Light Fixtures under traditional costing? Dining = 67,70 AS = 337 Good Tatry - sy secco ouerhet c. The Number of Units for each of the two products is as follows: Entry Dining Number of Units 8.282 13.69 Based on your answer to part 'b', what would the Overhead Per Unit be for Entry Light Fixtures under traditional costing? What would the Overhead Por Unit be for Dining Light Fixtures under traditional costing? (Sorry numbers do not come out IC Round to the nearest cent 73,69 3019 d. N company is considering adopting Activity-Based Costing. That means the $588,600 of overhead must be divided into activities and a Cost Driver selected for each activity and the Nunt of Cost Driver Units determined. The company accountant did all that and provided you with the following information: Cost of Activity Activity Cost Driver Total Cost Driver Units Casting $286.000 Machine hours 11,000 161.000 Assembly Direct labor hours 11,500 27.600 Inspecting Number of inspections 2.300 Setup 78.000 Number of setups 300 Materials Handling 36.000 Number of loads 1.000 Assume N Company uses Activity-Based Costing. What are N Company's five Overhead Application Rates? (Please label your answer clearly so many dollars per what?) ob per nache hear per Inspections a to per setup 36 Numar of loods e. Next we need to know the number of Cost Driver Units used by each of the two products. (Notice if you add across, you get the Total Cost Driver Units amount from part ") They are as follows Entry Dining Machine hours 6,000 5,000 Direct labor hours 4,600 6.900 Number of inspections 1.700 600 Number of setups 240 80 Number of loads 780 220 Based on your answers to part d', how much overhead should be assigned to the Entry Light Fixtures under Activity-Based Costing? How much overhead should be assigned to the Dining Light Fixtures under Activity-Based Costing? 156000 po near buco 0400 62400 18000 33 1780 . Refer to the number of units of each type of product in parte. Based on your answer to part what would the Overhead Per Unit be for Entry Light Fixtures under activity based costing? What would the Overhead Per Unit be for Dining Light Fixtures under activity-based costing? no Plerunit 56 9. Compare the per unit Overhead amounts from parts and Which set of figures is more accurate? Why? Do the Entry Light Fixtures actually cost more or less per unit than what we previously thought? Do the Dining Light Fixtures actually cost more or less per unit than what we previously thought? 3. What would be good cost drivers to use for the following activities for a firm using Activity Based Costing? Supervising Employees Scheduling Production Performing Quality Control Managing Raw Materials 4. J Company uses Activity-Based Costing and has the following Overhead Application Rates For each rate, indicate two ways that management could cut company costs without sacrificing the quality of products made for customers $400 per setup $200 per moveme $100 per inspection m Company has two product lines that it walls at ito store Performance Evaluation figures Sales Variable costs Contribution or Sto Model $300.000 Show Model 2 $750,000 450.000 $300.000 120.000 $100.000 (since there are two products and management divides the total (NOTE amount ovenly between them) total profit (520.000) $100,000 $100.000) ve Modell bedien d Why why management discontinues tove what would the total prot generated by the store be?) hou Model o company produces sweaters with a particul sweaters a month at a g a r football team's logo on them the ofach Variable and fixed costs are a $15.000 Variable Cost Per Sweater Direct Materials 515 Direct Labor Variable Overhead 10 Selling Expenses Total $30 Fixed Costs Per Month Fixed Overhead General and Admin istrative Expenses Total 10.000 $25,000 Prepare a contribution margin income statement for a month Problem continues on next page) b. Determine L Company's contribution margin per unit and contribution margin ratio c. Determine L Company's monthly breakeven in units and dollars. Determin d. Determine L Company's margin of safety in units and dollars Petermine the amount of sales in units and dollars that L Company would have to generate to eam a monthly profit of $6,500 If the firm expects to make and sell 3.200 sweaters next month at the S40 price with the usual 525.000 fixed cost what variable cost per unit would be needed to generate a desired monthly profit of $8.500? Go back to the original problem of competitive pressures for price to 538 per unit, how many units would have to the company to drop its selling b e