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Chapter 5 Homework Assignment 0 Saved Help Saves. Exit Submit for years: the deluxe model was introduced several years ago to capture a new segment
Chapter 5 Homework Assignment 0 Saved Help Saves. Exit Submit for years: the deluxe model was introduced several years ago to capture a new segment of the market. Since the introduction ofthe deluxe model. the company's profits have steadily declined. and management has become concerned about the accuracy of its costing system. Sales of the deluxe model have been increasing rapidly. 1 Siegel Corporation manufactures a product available in both a deluxe and a regular model. The company has made the regular model Overhead is applied to products on the basis of direct labourehours. At the beginning oithe current year, management estimated that $1,860,800 in overhead costs would be incurred and the company would produce and sell 5,000 units of the deluxe model and 23,968 units ofthe regular model. The deluxe model requires 2.3 hours of direct labourtime per unit. and the regular model requires Skwed 1.5 hours. Materials and labour costs follow: 10 points Deluxe Regular Direct materials cost per unit $115 $83 9500\" Direct labour cost per hour 23 15 l Print References Required: 1. Compute the predetermined overhead rate using direct labourehours as the basis for allocating overhead costs to products. Compute the unit product cost for one unit of each model. (Do not round intermediate calculations Round your answers to 2 decimal places.) Predelermined overhead rate per DLH Unit product cost of Deluxe Ul'l ll product cost of Regular % Prev 1 01 1 555 Next Chapter 5 Homework Assignment i Saved Help Save & Exit Submit 2. An intern suggested that the company use activity-based costing to cost its products. A team was formed to investigate this idea, and it came back with the recommendation that four activity cost pools be used. These cost pools and their associated activities follow: Estimated Activity Activity Cost Pool and Overhead 10 Activity Measure Cost Deluxe Regular Total Purchase orders (number of orders) $ 151, 800 900 1, 400 2, 300 points Rework requests (number of requests) 309, 000 500 1, 000 1 , 500 Product testing (number of tests) 350,000 5,000 12, 500 17, 500 Skipped Machine related (machine-hours) 1, 050, 000 16, 000 26, 000 42, 000 $1, 860, 800 eBook Print Compute the activity rate (i.e., predetermined overhead rate) for each of the activity cost pools. References Activity Cost Pool Activity Rate Purchase orders per order Rework requests per request Product testing per test Machine related per MH 3. Assume that actual activity is as expected for the year. Using activity-based costing, do the following: a. Determine the total amount of overhead that would be applied to each model for the year. (Do not round intermediate calculations Mc Graw HillChapter 5 Homework Assignment i Saved Help Save & Exit Submit 3. Assume that actual activity is as expected for the year. Using activity-based costing, do the following: a. Determine the total amount of overhead that would be applied to each model for the year. (Do not round intermediate calculations 10 and round your final answers to nearest whole dollar amount.) points Deluxe Regular Skipped Total overhead cost eBook Print References b. Compute the unit product cost for one unit of each model. (Do not round intermediate calculations and round your answers to 2 decimal places.) Deluxe Regular Unit product cost 4. This part of the question is not part of your Connect assignment. Mc Graw Hill
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