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Exercise 3-3 Compute ABC Product Costs [LO3-3] Larner Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains the following six
Exercise 3-3 Compute ABC Product Costs [LO3-3]
| Larner Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains the following six activity cost pools and activity rates: |
| Activity Cost Pool | Activity Rates | ||
| Labor-related | $ | 7.00 | per direct labor-hour |
| Machine-related | $ | 5.00 | per machine-hour |
| Machine setups | $ | 40.00 | per setup |
| Production orders | $ | 200.00 | per order |
| Shipments | $ | 120.00 | per shipment |
| General factory | $ | 5.00 | per direct labor-hour |
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| Cost and activity data have been supplied for the following products: |
| J78 | B52 | |||
| Direct materials cost per unit | $ | 7.00 | $ | 50.00 |
| Direct labor cost per unit | $ | 4.00 | $ | 10.00 |
| Number of units produced per year | 2,000 | 100 | ||
| Total Expected Activity | |||
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| J78 | B52 | ||
| Direct labor-hours | 1,000 | 20 | |
| Machine-hours | 3,400 | 20 | |
| Machine setups | 8 | 2 | |
| Production orders | 6 | 2 | |
| Shipments | 7 | 2 | |
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| Required: | ||||||||||||||||||
| Compute the unit product cost of each product listed above. (Round your answers to 2 decimal places.) | ||||||||||||||||||
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Organizational Auditing And Assurance In The Digital Age
Authors: Rui Pedro Marques, Carlos Santos, Helena Inácio
1st Edition
1522573569, 978-1522573562
