Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Crane, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher.

image text in transcribed

Crane, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers: (1) a home fire extinguisher and (2) a commercial fire extinguisher. The home model is a high-volume (54,000 units), half-gallon cylinder that holds 2 1/2 pounds of multi-purpose dry chemical at 480 PSI. The commercial model is a low-volume (10.200 units), two- gallon cylinder that holds 10 pounds of multi-purpose dry chemical at 390 PSI. Both products require 1.5 hours of direct labor for completion. Therefore, total annual direct labor hours are 96,300 or 11.5 hours x (54,000+10,200 Estimated annual manufacturing overhead is $1,577,308. Thus, the predetermined overhead rate is $16.38 or ($1,577,308 96,300) per direct labor hour. The direct materials cost per unit is $18.50 for the home model and $26.50 for the commercial model. The direct labor cost is $19 per unit for both the home and the commercial models. The company's managers identified six activity cost pools and related cost drivers and accumulated overhead by cost pool as follows Estimated Use of Drivers by Product Estimated Estimated Use of Activity Cost Pools Cost Drivers Overhead Cost Drivers Home Commercial Receiving Pounds $83,750 335,000 215,000 120,000 Forming Machine hours 152,950 35,000 27,000 8,000 Number of Assembling 407.960 217,000 165,000 52.000 parts Number of Testing 54,060 25.500 15.500 10,000 tests Painting Gallons Packing and shipping Pounds 57,838 820,750 5,258 335,000 215,000 3.680 1578 120,000 $1,577,308 (a) Under traditional product costing compute the total unit cost of each product. (Round answers to 2 decimal places, eg. 12. Commercial Model Home Model Total unit cost $ eTextbook and Media Save for Later Attempts: 0 of 3used Submit Answer (b) The parts of this question must be completed in order. This part will be available when you complete the part above The parts of this question must be completed in order. This part will be available when you complete the purtave (d) The parts of this question must be completed in order. This part will be avallate when you complete the part above

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

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

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

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

Fundamentals of Cost Accounting

Authors: William Lanen, Shannon Anderson, Michael Maher

5th edition

978-1259728877, 1259728870, 978-1259565403

More Books

Students also viewed these Accounting questions

Question

How should you go about allocating system tasks to processors?

Answered: 1 week ago