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Aleutian Company produces two products: Rings and Dings. They are manufactured in two departments: Fabrication and Assembly. Data for the products and departments are listed
Aleutian Company produces two products: Rings and Dings. They are manufactured in two departments: Fabrication and Assembly. Data for the products and departments are listed below. Number of Units Direct Labor Hours Per Unit Machine Hours Per Unit Product Rings Dings 1,040 1,840 All of the machine hours take place in the Fabrication Department, which has estimated total factory overhead of $84,700. All of the labor hours take place in the Assembly Department, which has estimated total factory overhead of $69,000. Aleutian Company uses the multiple production department factory overhead rate method. The Fabrication Department uses machine hours as an allocation base, and the Assembly Department uses direct labor hours. The total factory overhead allocated per unit of Dings is a. $60.75 b. $4.45 c. $40.30 d. $53.37 Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below. Procurement Scheduling Materials handling Product development Activity Cost Activity Base $312,400 Number of purchase orders 202,500 Number of production orders 416,500 Number of moves 791,100 Number of engineering changes 1,527,400 Machine hours Production Number of Engineering Changes Number of Number of Number Purchase Production of Orders Orders Moves 4,040 450 1,260 2,300 145 520 12,900 990 4,500 Number of Units 2,500 3,500 2,100 Machine Hours 2,500 9,600 11,400 Disk drives Tape drives Wire drives The activity rate for the procurement activity cost pool is a. $16.24 per purchase order b. $65.00 per purchase order c. $197.10 per purchase order d. $127.76 per purchase order Panamint Systems Corporation is estimating activity costs associated with producing disk drives, tapes drives, and wire drives. The indirect labor can be traced to four separate activity pools. The budgeted activity cost and activity base data by product are provided below. Procurement Scheduling Materials handling Product development Production Activity Cost Activity Base $330,700 Number of purchase orders 241,600 Number of production orders 407,700 Number of moves 701,500 Number of engineering changes 1,493,300 Machine hours Purchase Orders Number of Number Production of Orders Moves Number of Engineering Changes Machine Hours Number of Units Disk drives 4,140 1,900 12,200 400 215 Tape drives Wire drives 1,450 790 3,700 2,200 9,400 10,400 1,800 4,000 2,000 740 The activity-based cost for each tape drive unit is Oa. $18.13 Ob. $314.85 c. $222.45 d. $859.18 Adirondack Marketing Inc. manufactures two products, A and B. Presently, the company uses a single plantwide factory overhead rate for allocating overhead to products. However, management is considering moving to a multiple department rate system for allocating overhead. DLH per Product Total Direct Labor Hours 10,700 10,300 Overhead $247,100 72,700 $319,800 Painting Dept. Finishing Dept. Totals 21,000 The single plantwide factory overhead rate for Adirondack Marketing Inc. is a. $23.09 per dih Ob. $15.23 per din c. $3.80 per din d. $7.06 per din
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