Activity Assembly Electricity Materials purchasing Total Budgeted Cost $ 162,000 36,000 72,000 $ 270,000 Activity Cost Driver Direct labor hours (DLH) Machine hours (MH) Purchase orders (PO) Budgeted Activity Usage 54,000 10,000 600 Required: 1. Compute an activity rate for each activity using activity-based costing. 2. The following actual activity usage produced 10,000 Pup tents and 6,000 Pop-up tents. Allocate overhead cost to Pup tents and to Pop-up tents and compute overhead cost per unit for each product. Activity Usage Activity Cost Driver Pup tents Pop-up tents Direct labor hours (DLH) 36,000 18,000 Machine hours (MH) 4,500 5,500 Purchase orders (PO) 250 350 3. Compute product cost per unit for Pup tents and for Pop-up tents. 4. For each product, compute the gross profit per unit (selling price per unit minus the product cost per unit). Required information (The following information applies to the questions displayed below.] Tent Master produces Pup tents and Pop-up tents. The company budgets $270,000 of overhead cost and 54,000 direct labor hours. Additional information follows. Per Unit Pup tent Pop-up tent Selling Price $ 84 79 Direct Materials $ 25 25 Direct Labor $ 47 32 Required 1 Required 2 Required 3 Required 4 Compute a single plantwide overhead rate assuming the company allocates overhead cost based on 54,000 direct labor hours. Numerator Total budgeted overhead cost per direct labor hour Denominator Required 1 Required 2 > Required 1 Required 2 Required 3 Required 4 Pup tents use 3 direct labor hours (DLH) per unit and Pop-up tents use 2 direct labor hours per unit. Compute the overhead cost per unit for each product. Plantwide Overhead Rate Direct Labor Hours per Unit Pup tent Pop-up tent Overhead Cost per Unit per unit per unit Required 1 Required 2 Required 3 Required 4 Compute the product cost per unit for each product. Per Unit Direct Materials Overhead Cost Product Cost Direct Labor per Unit per Unit Pup tent $ 25 $ 47 Pop-up tent 25 32 Required 1 Required 2 Required 3 Required 4 For each product, compute the gross profit per unit (selling price per unit minus the product cost per unit). (Enter any product costs in excess of selling prices as negative values.) Per Unit Pup tent Pop-up tent Selling Price Product Cost Gross Profit $ 84 79 The following actual activity usage produced 10,000 Pup tents and 6,000 Pop-up tents. Allocate overhead cost to Pup tents and to Pop-up tents and compute overhead cost per unit for each product. (Round "Activity Rate" and "Overhead per unit" to 2 decimal places.) Allocate overhead to Pup tent Activity Usage Activity Rate Allocated Cost $ 0 0 Activity Assembly Electricity Materials purchasing Total allocated cost Units produced Overhead cost per unit 0 $ 0 Allocate overhead to Pop-up tent Activity Usage Activity Rate Activity Assembly Electricity Materials purchasing Total allocated cost Units produced Overhead cost per unit Allocated Cost $ 0 0 0 $ 0 FA Required 1 Required 2 Required 3 Required 4 Compute product cost per unit for Pup tents and for Pop-up tents. (Round "Activity Rate" and final answers to 2 decimal places.) Per Unit Overhead Product Cost per Unit Pup tent Pop-up tent Direct Materials Direct Labor $ 25.00 $ 47.00 25.00 32.00 Required 1 Required 2 Required 3 Required 4 For each product, compute the gross profit per unit (selling price per unit minus the product cost per unit). (Round "Activity Rate" and final answers to 2 decimal places. Enter any product costs in excess of selling prices as negative values.) Per Unit Pup tent Pop-up tent Selling Price Product Cost Gross Profit $ 84.00 79.00
