Fanning Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity cost pools follow: Activities Unit Level Batch Level Product Level Facility Level Cost $ 39,600 $18,480 $ 19, eee $247,600 Cost driver 1,800 labor hrs. 42 setups Percentage of use 19,000 units Production of 900 sets of cutting shears, one of the company's 20 products, took 110 labor hours and 9 setups and consumed 19 percent of the product-sustaining activities. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 900 units are produced. If direct product costs are $190 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Complete this question by entering your answers in the tabs below. Reg A and B Reqc Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? How much overhead is allocated to the cutting shears using activity-based costing? (Round intermediate calculations to 2 decimal places. Round your final answers to the nearest whole dollar amount.) a Allocated cost Allocated cost b Reg A and B Reqc > Fanning Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity cost pools follow: Activities Unit Level Batch Level Product Level Facility Level Cost $ 39,600 $18,480 $19,000 $247,000 Cost driver 1,800 labor hrs. 42 setups Percentage of use 19,880 units Production of 900 sets of cutting shears, one of the company's 20 products, took 110 labor hours and 9 setups and consumed 19 percent of the product-sustaining activities. Required a. Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? b. How much overhead is allocated to the cutting shears using activity-based costing? c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 900 units are produced. If direct product costs are $190 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? Complete this question by entering your answers in the tabs below. Reg A and B Reg C Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 900 units are produced. If direct product costs are $190 and the product is priced at 30 percent above cost for what price would the product sell under each allocation system? (Round intermediate calculations and final answers to 2 decimal places.) Show less ABC Labor Hrs Allocated overhead Direct cost Total cost per unit Desired profit Sales price 0.00 0.00 $ 0.00 $ 0.00
