Question
Activity-Based Costing and Conventional Costs Compared Chef Grill Company manufactures two types of cooking grills: the Gas Cooker and the Charcoal Smoker. The Cooker is
Activity-Based Costing and Conventional Costs Compared Chef Grill Company manufactures two types of cooking grills: the Gas Cooker and the Charcoal Smoker. The Cooker is a premium product sold in upscale outdoor shops; the Smoker is sold in major discount stores. Following is information pertaining to the manufacturing costs for the current month.
Gas Cooker | Charcoal Smoker | |
Units | 1000 | 3000 |
Number of Batches | 20 | 10 |
Number of Batch Moves | 80 | 20 |
Direct materials | $30,000 | $100,000 |
Director Labor | $20,000 | $29,000 |
Manufacturing overhead follows:
Activity | Cost | Cost Driver |
Materials Acquisition and inspection | $299,000 | Amount direct materials Cost |
Materials Movement | $16,600 | Number of batch moves |
Scheduling | $18,000 | Number of batches |
$333,600 |
Rounding instructions: Do not round until your final answers. Round total cost answers to the nearest dollar and per unit answers to the nearest cent.
(a) Determine the total and per-unit costs of manufacturing the Gas Cooker and Charcoal Smoker for the month, assuming all manufacturing overhead is assigned on the basis of direct labor dollars.
HINT: Use 6.8082 for overhead rate calculations.
Total Cost | $ Answer | |
Gas Cooker | $ Answer | per unit |
Charcoal Smoker | $Answer | per unit |
(b) Determine the total and per-unit costs of manufacturing the Gas Cooker and Charcoal Smoker for the month, assuming manufacturing overhead is assigned using activity-based costing.
Total Cost | $ Answer | |
Gas Cooker | $ Answer | per unit |
Charcoal Smoker | $ Answer | per unit |
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