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Approximately Relevant ABC Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Setting up equipment Ordering
Approximately Relevant ABC Silven Company has identified the following overhead activities, costs, and activity drivers for the coming year: Activity Setting up equipment Ordering materials Machining Receiving Expected Cost Activity Driver Activity Capacity $135,000 Number of setups 120 10,800 108,500 Number of orders Machine hours 600 10,850 26,700 Receiving hours 1,335 Silven produces two models of cell phones with the following expected activity demands: Units completed Model X 4,400 Model Y 8,800 Number of setups 80 40 Number of orders 200 400 Machine hours 6,200 Receiving hours 445 4,650 890 Required: 1. Determine the total overhead assigned to each product using the four activity drivers. Model X Model Y Total Overhead Assigned 164,500 116,500 2. Determine the total overhead assigned to each model using the two most expensive activities. The costs of the two relatively inexpensive activities are allocated to the two expensive activities in proportion to their costs. Round interim calculations to two decimal places and round your final answers to the nearest dollar. Model X Model Y Total Overhead Assigned 3. Using ABC as the benchmark, calculate the percentage error. Round your answers to two decimal places. Ordering materials 10,000 Number of orders Machining 108,500 Machine hours Receiving 26,700 Receiving hours 600 10,850 1,335 Silven produces two models of cell phones with the following expected activity demands: Units completed Model X 4,400 Model Y 8,800 Number of setups 80 40 Number of orders 200 400 Machine hours 6,200 4,650 Receiving hours 445 890 Required: 1. Determine the total overhead assigned to each product using the four activity drivers. Model X Model Y Total Overhead Assigned 164,500 116,500 2. Determine the total overhead assigned to each model using the two most expensive activities. The costs of the two relatively inexpensive activities are allocated to the two expensive activities in proportion to their costs. Round interim calculations to two decimal places and round your final answers to the nearest dollar. Total Overhead Assigned Model X Model Y 3. Using ABC as the benchmark, calculate the percentage error. Round your answers to two decimal places. Model X Model Y Feedback Percentage Error % %
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