Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Carlise Corp., which manufactures ceiling fans, currently has two product lines, the Indoor and the Outdoor. Carlise has total overhead of $131,060. Carlise has identified

Carlise Corp., which manufactures ceiling fans, currently has two product lines, the Indoor and the Outdoor. Carlise has total overhead of $131,060. Carlise has identified the following information about its overhead activity cost pools and the two product lines:

Activity Cost Pools Cost Driver Cost Assigned to Pool Quantity/Amount Consumed by Indoor Line Quantity/Amount Consumed by Outdoor Line
Materials handling Number of moves $ 18,620 630 moves 350 moves
Quality control Number of inspections $ 72,960 6,400 inspections 3,200 inspections
Machine maintenance Number of machine hours $ 39,480 21,000 machine hours 26,000 machine hours

Required: 1. Suppose Carlise used a traditional costing system with machine hours as the cost driver. Determine the amount of overhead assigned to each product line. (Do not round intermediate calculations and round your final answers to the nearest whole dollar amount.)

Overhead Assigned
Indoor Model
Outdoor Model
Total $0

2. Calculate the activity proportions for each cost pool in Carlise's ABC system. (Round your answers to 2 decimal places.)

Activity Proportions
Indoor Line Outdoor Line
Materials Handling % % per Move
Quality Control % % per Inspection
Machine maintenance % % per Machine Hour

3. Calculate the amount of overhead that Carlise will assign to the Indoor line if it uses an ABC system. (Round your intermediate calculations to 2 decimal places and round your final answers to the nearest whole dollar amount.)

Indoor Model
Materials Handling
Quality Control
Machine maintenance
Total Overhead Assigned $0

4. Determine the amount of overhead Carlise will assign to the Outdoor line if it uses an ABC system. (Round your intermediate calculations to 2 decimal places and round your final answers to the nearest whole dollar amount.)

Outdoor Model
Materials Handling
Quality Control
Machine maintenance
Total Overhead Assigned $0

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Accounting

Authors: Joe Hoyle, Thomas Schaefer, Timothy Doupnik

10th edition

0-07-794127-6, 978-0-07-79412, 978-0077431808

Students also viewed these Accounting questions