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EyeGuard Equipment Incorporated (EEI) manufactures protective eyewear for use in commercial and home applications. The product is also used by hunters, home woodworking hobbyists, and
EyeGuard Equipment Incorporated (EEI) manufactures protective eyewear for use in commercial and home applications. The product is also used by hunters, home woodworking hobbyists, and in other applications. The firm has two main product linesthe highest- quality product is called Safe-T, and a low-cost, value version is called Safe-V. Information on the factory conversion costs for EEl is as follows: Salaries Supplies Factory expense Total Factory Costs $ 844, 000 144,000 544, 000 $ 1,532,000 EEl uses ABC to determine the unit costs of its products. The firm uses resource consumption cost drivers based on rough estimates of the amount that each activity consumes, as shown below. EEl has four activities: job setup, assembly, inspecting and finishing, and packaging Setup 15% 20 Salaries Supplies Factory expense Packaging 10% Inspecting and Finishing 20% 20 20 Assembly 55% 60 80 Total 100% 100 100 The activity cost drivers for the two products are summarized below. Activities Setup Assembly Inspect and finishing Packaging Acti ty Driver Batch Units Finishing hours Packing hours Batches Units Finishing hours, per unit Packaging hours, per unit Materials per unit Safe-V 190 54,000 0. 20 0.10 $ 3.50 Safe-T 540 66,000 0.30 0.15 $ 6.00 Required: 1. Determine the amount of the cost pool for each of the four activities. 2. Determine the activity-driver rates for assigning factory costs to the two products. 3. Determine the activity-based unit cost for each of the products. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Determine the amount of the cost pool for each of the four activities. Factory Costs Setup Assembly Inspecting & Finishing Packaging Salaries Supplies Factory expense $ 0 $ 0 $ 0 $ 0 $ 0 Required 1 Required 2 Required 3 Determine the activity-driver rates for assigning factory costs to the two products. (Round your answers to 2 decimal places.) Activity-Driver Rates Setup Assembly Inspect and Finish Packaging Required 1 Required 2 Required 3 Required 3 Determine the activity-based unit cost for each of the products. (Round your intermediate calculations and final answers to 2 decimal places.) Safe-V Safe-T Activity-based cost per unit
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