Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Foam Products, Inc., makes foam seat cushions for the automotive and aerospace industries. The companys activity-based costing system has four activity cost pools, which are

Foam Products, Inc., makes foam seat cushions for the automotive and aerospace industries. The companys activity-based costing system has four activity cost pools, which are listed below along with their activity measures and activity rates:

Activity Cost Pool Activity Measure Activity Rate
Supporting direct labor Number of direct labor-hours $ 9 per direct labor-hour
Batch processing Number of batches $ 99 per batch
Order processing Number of orders $ 287 per order
Customer service Number of customers $ 2,611 per customer

The company just completed a single order from Interstate Trucking for 1,800 custom seat cushions. The order was produced in three batches. Each seat cushion required 0.8 direct labor-hours. The selling price was $141.70 per unit, the direct materials cost was $103 per unit, and the direct labor cost was $14.50 per unit. This was Interstate Truckings only order during the year.

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

Step: 3

blur-text-image

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

Financial Accounting Tools for Business Decision Making

Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso

8th edition

978-1118953815, 978-1118953907

More Books

Students also viewed these Accounting questions

Question

If X has distribution function F(t) = 0, t Answered: 1 week ago

Answered: 1 week ago