CH 26-4

INSTRUCTIONS

Teldar Manufacturing Company is a diversified manufacturer that manufactures three products (M5, Z4, and I8) in a continuous production process. Senior management has asked the controller to conduct an activity-based costing study. The controller identified the amount of factory overhead required by the critical activities of the organization as follows:

The activity bases identified for each activity are as follows:

The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows:

Each product requires 0.79 machine hour per unit.

REQUIRED

Complete the Activity Tables for M5, Z4 and I8.

1. Determine the activity rate for each activity.*

2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with all three products.*

* If required, round all per-unit amounts to the nearest cent.

Complete the Activity Table for M5.

1. Determine the activity rate for each activity.*

2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with all three products.*

* If required, round all per-unit amounts to the nearest cent.

Complete the Activity Table for Z4.

1. Determine the activity rate for each activity.*

2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with all three products.*

* If required, round all per-unit amounts to the nearest cent.

Complete the Activity Table for I8.

	1. Determine the activity rate for each activity.*
	2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with all three products.*
	* If required, round all per-unit amounts to the nearest cent.

Activity 2 Production 3 Setup 4 Material handling 5 Inspection 6 Product engineering 7 Total Activity Cost Pool $242,089.00 88,425.00 9,253.00 49,623.00 167,990.00 $557380.00