Question
Fogerty Company makes two productstitanium Hubs and Sprockets. Data regarding the two products follow: Direct Labor-Hours per Unit Annual Production Hubs 0.60 14,000 units Sprockets
Fogerty Company makes two productstitanium Hubs and Sprockets. Data regarding the two products follow:
| Direct Labor-Hours per Unit | Annual Production | ||
|---|---|---|---|
| Hubs | 0.60 | 14,000 | units |
| Sprockets | 0.20 | 58,000 | units |
Additional information about the company follows:
Hubs require $34 in direct materials per unit, and Sprockets require $19.
The direct labor wage rate is $17 per hour.
Hubs require special equipment and are more complex to manufacture than Sprockets.
The ABC system has the following activity cost pools:
| Activity Cost Pool (Activity Measure) | Estimated Overhead Cost | Activity | ||
|---|---|---|---|---|
| Hubs | Sprockets | Total | ||
| Machine setups (number of setups) | $ 25,875 | 115 | 92 | 207 |
| Special processing (machine-hours) | $ 92,000 | 4,600 | 0 | 4,600 |
| General factory (organization-sustaining) | $ 205,600 | NA | NA | NA |
Required:
1. Compute the activity rate for each activity cost pool.
| ||||||||||
2. Determine the unit product cost of each product according to the ABC system.
(Do not round intermediate calculations. Round your answers to 2 decimal places.)
|
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Supply Chain Risk Management Applying Secure Acquisition Principles To Ensure A Trusted Technology Product Internal Audit And IT Audit
Authors: Ken Sigler, Dan Shoemaker, Anne Kohnke
1st Edition
1138197335, 978-1138197336
