Activity-based product costing Instructions Activity Tablo - Alpha Activity Table - Beta Activity Table - Omega Final Question 0 Instructions Mello Marutacturing Company is a diversified marutacturer that manufactures throw products (Alpha, Beta, and Omega) in a continuous production process. Senior management has asked the controller to conduct an activity based ooting otudy. The controllor dorilled the amount of factory overhead required by the critical activities of the organization as follows: 1 Activity Production Activity Cost Pool $270,840.00 98.945.00 10,604.00 Setup Material handling Inspection Product engineering Total 44,100.00 159,580.00 $563,869.00 The activity bates identified for each activity are as follows: Activity Production Setur Material handing Activity Base Machine hours Number of setups Number of parts Material handing Number of parts Inspection Number of inspection hours Product engineering Number of engineering hours The activity base usage quantities and units produced for the three products were determined from corporate records and are as follows: Machine Number of Number of Number of Number of Hours Setups Parts Inspection Hours Engineering Hours Units Alpha 1,061 55 84 130 1,341 Beta 707 125 158 281 183 927 Omega 302 205 240 232 192 542 Total 2.220 385 482 980 505 2,810 Each product requires 40 minutes per unit of machine time Required Complete the Activity Tables for Apna Beta and Omega 1. Determine the activitate for each activity 2 Use the activity rates in (7) to determine the total and persunt aceity costs associated with all three products 3 Why are the activity unit costs equal across all three products since they require the same machine tine per unit? * required, round all per unit amounts to the nearest et Activity Table - Alpha Complete the Activily Table for Alpha. 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns 2. Use the activity rates in (0) to determine the total and per-unit activity costs associated with Alpha "required, round all per-unit amounts to the nearest cent Alpha Activity Activity Base Activity Activity Usage Rate Cost Production 5 $ Setup $ Material handing s > Inspection s Product Engineering $ Total activity cost $ Number of units Activity cost per unit $ Activity Table - Bota Complete the Activity Table for Beta. 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns 2 Use the activity rates in (1) to determine the total and per-unit activity costs associated with Beta * required, round al per-unit amounts to the nearest cont. Beta Activity Activity Base Activity Activity Usage Rate Cost Production $ $ Setup $ > Material handling $ > $ Inspection $ Product Engineering $ Total activity cost S Number of units Activity cost per unit S Activity Tablo - Omega Complete the Activity Table for Omega 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns 2. Use the activity rates in (t) to determine the total and per-unit activity costs associated with Omega *Wrequired, round all per-unit amounts to the nearest cont. Omega Activity Activity Base Activity Activity Usage X Rato Cost Production S Setup S Material handling $ > Inspection s Product Engineering $ Total activity cost Number of units Activity cost per unit $ 3. Why aren't the activity unit costs equal across all three products since they require the same machine time per unt? The differences because the products consume many activities in ratios diferent from the volume The difference is due to machine inefficiencies The difference is due to product cost distortions