Connect 17

Healthy Day Company produces two beverages, PowerPunch and SlimLife. Data about these products follow. PowerPunch Production volume Liquid materials Dry materials Bottles Labels Machine setups Machine hours SlimLife 11,500 bottles 230,000 bottles 1,200 gallons 25,000 gallons 1,220 pounds 18,000 pounds 11,500 bottles labels per 3 bottle 230,000 bottles label per 1 bottle 700 setups 800 setups 170 MH 3,750 MH Additional data from its two production departments follow. Departm Driver ent Mixing departm ent Liq uid Gallons material s Dry material Pounds s Util Machin ities e hours Bottlin g departm ent Bot Units tles Labels Lab per eling bottle Ma Setups Cost $ 1,310 8,649 2,352 $ 72,450 10,580 45,000 chine setup references 1. value: 10 points Required 1. Determine the cost of each product line using ABC. (Do not round your intermediate calculations and round your final answers to the nearest dollar amount. Omit the "$" sign in your response.) Product cost PowerPunch SlimLife $ $ check my workeBook Linkreferences 2. value: 10 points 2. What is the cost per bottle for PowerPunch and SlimLife? (Do not round intermediate calculations and round your final answers to 2 decimal places. Omit the "$" sign in your response.) PowerPunch Average cost per bottle SlimLife $ / bottle $ / bottle check my workeBook Linkreferences 3. value: 10 points 3. Assume if PowerPunch sells for $7.25 per bottle, how much profit does the company earn per bottle of PowerPunch that it sells? (Do not round intermediate calculations and round your final answers to 2 decimal places. Omit the "$" sign in your response.) Profit per bottle $ check my workeBook Linkreferences 4. value: 10 points 4. What is the minimum price that the company should set per bottle of SlimLife? rev: 02_10_2012 $0.49 per bottle $0.69 per bottle $0.84 per bottle Craftmore Machining produces machine tools for the construction industry. The following details about overhead costs were taken from its company records. Prod Indire uctio Indire ct n ct Mater Activ Labor ials ity Grin 340,0 $ ding 00 Poli shing Prod uct 600,0 modif 00 icatio n Prov iding powe r Syst em 550,0 calibr 00 ation Other Overhead $ 185,0 00 $ 255,0 00 Additional information on the drivers for its production activities follows. Grinding Polishing 19,000 machine hours 19,000 machine hours Product modification Providing power System calibration engineering 1,800 hours direct labor 14,000 hours 1,200 batches references 5. value: 10 points Required: 1. Classify each activity as unit level, batch level, product level, or facility level. Grinding Polishing Product modification Providing power System calibration check my workeBook Links (5)references 6. value: 10 points 2. Compute the activity overhead rates using ABC. Form cost pools as appropriate. (Round your answers to 2 decimal places. Omit the "$" sign in your response.) Grinding & Polishing Product modification Providing power System calibration $ per MH $ per Eng. Hr. $ per DLH $ per batch check my workeBook Links (5)references 7. value: 10 points Job 3175 Number of units Machine hours Engineeri ng hours Batches Direct labor hours Job 4286 170 units 2,125 units 350 MH 3,500 MH 33 eng hours 28 eng. hours 15 batches 45 batches 460 DLH 4,140 DLH 3. Determine overhead costs to assign to the following jobs using ABC. (Use the rates calculated in Part 2 and then round your intermediate calculations and your final answers to the nearest whole number. Omit the "$" sign in your response.) Total cost of job Job 3175 $ Job 4286 $ check my workeBook Links (5)references 8. value: 10 points 4. What is the overhead cost per unit for Job 3175? What is the overhead cost per unit for Job 4286? (Use the total job cost in Part 3 and then round your final answers to 2 decimal places. Omit the "$" sign in your response.) Job 3175 Average overhead cost per unit Job 4286 $ $ check my workeBook Links (5)references 9. value: 10 points 5. Assume if the company used a plantwide overhead rate based on direct labor hours, what is the overhead cost for each unit of Job 3175? Of Job 4286? (Round your cost per DLH to 2 decimal places, intermediate calculations to the nearest dollar amount and final answers to 2 decimal places. Omit the "$" sign in your response.) Job 3175 Job 4286 $ $ Average overhead cost per unit 10. value: 10 points The following data are for the two products produced by Shakti Company. Product A Direct materials Direct labor hours Machine hours Batches Volume Engineerin g modification s Number of customers Market price Product B $ 14 per unit $ 24 per unit 0.5 DLH per unit 0.4 MH per unit 90 batches 10,000 units 1.6 DLH per unit 1.2 MH per unit 180 batches 2,000 units 9 modification s 45 modification s 500 customers 400 customers $ 34 per unit $ 95 per unit The company's direct labor rate is $20 per direct labor hour (DLH). Additional information follows. Costs Driver Indirect manufact uring Engi neering support Elec $ 24,000 25,600 Engineeri ng modificat ions Machine tricity Setu p costs Nonman ufacturin g hours 40,000 71,000 Cust omer service Batches Number of customer s Required: 1.1 Compute the manufacturing cost per unit using the plantwide overhead rate based on direct labor hours. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Product A Product B $ $ Total manufacturing cost per unit 1.2 What is the gross profit per unit? (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Product A Gross profit per unit Product B $ $ 2.1 How much gross profit is generated by each customer of Product A and Product B using the plantwide overhead rate? (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Product A Gross profit per customer Product B $ $ 2.2 What is the cost of providing customer service to each customer? (Round your answer to 2 decimal places. Omit the "$" sign in your response.) Customer service cost $ per customer 3.1 Determine the manufacturing cost per unit of each product line using ABC. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Product A Product B $ $ Total manufacturing cost per unit 3.2 What is the gross profit per unit? (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Product A Gross profit per unit Product B $ $ 4.1 How much gross profit is generated by each customer of Product A and Product B using ABC? (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Product A Gross profit per customer 4.2 Product B $ $ Is the gross profit per customer adequate for Product A? No Yes 4.3 Is the gross profit per customer adequate for Product B? Yes No 5. Which method of product costing gives better information to managers of this company? Joborder costing Activity based costing Process costing Tent Master produces two lines of tents sold to outdoor enthusiasts. The tents are cut to specifications in department A. In department B the tents are sewn and folded. The activities, costs, and drivers associated with these two manufacturing processes and its production support activities follow. Overhead Process Activity cost Driver Pattern Depart alignmen $ ment A t Quantity 70,200 Cutting 61,250 Moving product 73,800 Batches 600 Machin 12,500 e hours Moves 1,800 $ 205,250 Depart ment B Sewing Inspecti ng Folding $ 366,560 27,500 88,620 Direct labor 4,640 hours Inspecti 550 ons Units 31,650 $ 482,680 Support Design Providi ng space Material s handling $ 520,000 57,400 223,200 Modific ation 400 orders Square 8,200 feet Square yards $ 800,600 Additional production information on the two lines of tents follows. 930,000 Pup Tent Units produced Moves Batches Number of inspections Machine hours Direct labor hours Modification orders Space occupied Material required Pop-Up Tent 21,100 units 600 moves 150 batches 220 inspections 10,550 units 1,200 moves 450 batches 330 inspections 8,000 MH 4,500 MH 2,900 DLH 1,740 DLH modification 100 orders modification 300 orders 4,100 square feet 4,100 square feet 450,000 square yards 480,000 square yards references 11. value: 10 points Required: 1. Using a plantwide overhead rate based on direct labor hours, compute the overhead cost that is assigned to each pup tent and each pop-up tent. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Pup tent Pop-up tent Overhead cost $ / unit $ / unit check my workeBook Links (5)references 12. value: 10 points 2. Using the plantwide overhead rate, determine the total cost per unit for the two products if the direct materials and direct labor cost is $19 per pup tent and $22 per pop-up tent. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Pup tent Pop-up tent Total cost per unit $ / unit $ / unit check my workeBook Links (5)references 13. value: 10 points 3.1 Assume the market price of the pup tent is $85 and the market price of the pop-up tent is $170, determine the gross profit / loss per unit for each tent. (Input all amounts as positive values. Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Pup tent Pop-up tent $ $ What will be the management decide about the product Pup-tent? 3.2 Eliminate pup-tent Retain pup-tent check my workeBook Links (5)references 14. value: 10 points 4. Using ABC, compute the total cost per unit for each tent if the direct labor and direct materials cost is $19 per pup tent and $22 per pop-up tent. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Pup tent Pop-up tent Total cost per unit $ /unit $ /unit check my workeBook Links (5)references 15. value: 10 points 5. Assume if the market price is $85 per pup tent and $170 per pop-up tent, determine the gross profit / loss per unit for each tent. (Round your intermediate calculations and final answers to 2 decimal places. Omit the "$" sign in your response.) Pup tent Pop-up tent $ $