Question
Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs
Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system: |
Overhead costs: | |
Wages and salaries | $158,000 |
Other expenses | 137,000 |
Total | $295,000 |
Distribution of resource consumption: | ||||
Activity Cost Pools | ||||
Making Bouquets | Delivery | Other | Total | |
Wages and salaries | 55% | 20% | 25% | 100% |
Other expenses | 10% | 55% | 35% | 100% |
The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. |
The amount of activity for the year is as follows: |
Activity Cost Pool | Activity |
Making bouquets | 79,210 bouquets |
Delivery | 12,700 deliveries |
What would be the total overhead cost per bouquet according to the activity based costing system? In other words, what would be the overall activity rate for the making bouquets activity cost pool? (Round to the nearest whole cent.) |
$1.32 per bouquets
$1.27 per bouquets
$1.25 per bouquets
$1.17 per bouquets
Fogle Florist specializes in large floral bouquets for hotels and other commercial spaces. The company has provided the following data concerning its annual overhead costs and its activity based costing system: |
Overhead costs: | |
Wages and salaries | $143,000 |
Other expenses | 60,000 |
Total | $203,000 |
Distribution of resource consumption: | ||||
Activity Cost Pools | ||||
Making Bouquets | Delivery | Other | Total | |
Wages and salaries | 55% | 35% | 10% | 100% |
Other expenses | 40% | 30% | 30% | 100% |
The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. |
The amount of activity for the year is as follows: |
Activity Cost Pool | Activity |
Making bouquets | 58,325 bouquets |
Delivery | 8,500 deliveries |
What would be the total overhead cost per delivery according to the activity based costing system? In other words, what would be the overall activity rate for the deliveries activity cost pool? (Round to the nearest whole cent.) |
$7.58 per delivery
$6.30 per delivery
$8.87 per delivery
$8.01 per delivery
Ollivier Corporation has an activity-based costing system with three activity cost pools-Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow: |
Overhead costs: | |
Equipment expense | $117,000 |
Indirect labor | $11,400 |
Distribution of Resource Consumption Across Activity Cost Pools: | |||
Activity Cost Pools | |||
Processing | Supervising | Other | |
Equipment expense | 0.30 | 0.50 | 0.20 |
Indirect labor | 0.30 | 0.40 | 0.30 |
Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: |
Activity: | ||
MHs (Processing) | Batches (Supervising) | |
Product C4 | 16,500 | 1,290 |
Product L7 | 1,200 | 1,080 |
Total | 17,700 | 2,370 |
The activity rate for the Supervising activity cost pool under activity-based costing is closest to: |
$10.96 per batch
$54.18 per batch
$21.91 per batch
$26.61 per batch
Ollivier Corporation has an activity-based costing system with three activity cost pools-Processing, Supervising, and Other. In the first stage allocations, costs in the two overhead accounts, equipment expense and indirect labor, are allocated to the three activity cost pools based on resource consumption. Data used in the first stage allocations follow: |
Overhead costs: | |
Equipment expense | $64,000 |
Indirect labor | $13,800 |
Distribution of Resource Consumption Across Activity Cost Pools: | |||
Activity Cost Pools | |||
Processing | Supervising | Other | |
Equipment expense | 0.60 | 0.20 | 0.20 |
Indirect labor | 0.60 | 0.30 | 0.10 |
Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data for the company's two products follow: |
Activity: | ||
MHs (Processing) | Batches (Supervising) | |
Product C4 | 12,000 | 640 |
Product L7 | 1,330 | 1,010 |
Total | 13,330 | 1,650 |
What is the overhead cost assigned to Product L7 under activity-based costing? (Round your intermediate calculations to 2 decimal places and your final answer to nearest whole dollar.) |
$4,655
$15,028
$10,373
$25,006
Umanzor Corporation uses activity-based costing to assign overhead costs to products. Overhead costs have already been allocated to the company's three activity cost pools as follows: Processing, $52,200; Supervising, $36,700; and Other, $19,200. Processing costs are assigned to products using machine-hours (MHs) and Supervising costs are assigned to products using the number of batches. The costs in the Other activity cost pool are not assigned to products. Activity data appear below: |
MHs (Processing) | Batches (supervising) | |
Product S5 | 11,700 | 1,030 |
Product F5 | 1,270 | 900 |
Total | 12,970 | 1,930 |
The activity rate for the Processing activity cost pool under activity-based costing is closest to: |
$3.70 per MH
$4.02 per MH
$8.45 per MH
$4.32 per MH
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