Answered step by step
Verified Expert Solution
Link Copied!

Question

00
1 Approved Answer

for the indirect cost rate formula please check one of those options for all 4 slots for the indirect cost rate second column please choose

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

image text in transcribed

for the indirect cost rate formula please check one of those options for all 4 slots

for the indirect cost rate second column please choose one of those options for all 4 slots

Thank you

Eiko Inoue is the controller of Kato, Inc., an electronic controls company located in Osaka. She recently attended a seminar on activity-based costing (ABC) in Tokyo. Kato's traditional cost accounting system has three cost categories: direct materials, direct labor, and indirect production costs. The company allocates indirect production costs on the basis of direct-labor cost. The following is the 20X0 budget for the automotive controls department (in thousands of Japanese yen): (Click the icon to view the 20X0 budget.) i Data Table Direct materials Direct labor Indirect production costs 60,000 53,450 26,725 140,175 Total cost Print Done After Ms. Inoue attended the seminar, she suggested that Kato experiment with an ABC system in the Automotive Controls Department. She identified four main activities that cause indirect production costs in the department and selected a cost driver to use as a cost-allocation base for each activity as follows: (Click the icon to view the ABC data.) In 20X0 the Automotive Controls Department expects to produce 92,000 control units, use 590 quality control hours, and ship 8,500 boxes. Read the requirements. i Data Table Activity Cost-Allocation Base Receiving Direct materials cost Assembly Number of control units Quality control QC hours Shipping Number of boxes shipped Predicted 20X0 Cost (4000) 7,200 13,800 1,475 4,250 TOTAL 26,725 1. Explain how Kato, Inc., allocates its indirect production costs using its traditional cost system. Include a computation of the allocation rate used. 2. Explain how Kato, Inc., would allocate indirect production costs under Ms. Inoue's proposed ABC system. Include a computation of all the allocation rates used. 3. Suppose Kato prices its products at 15% above total production cost. An order came in from Toyota for 10,000 control units. Inoue estimates that filling the order will require 3,500,000 of direct-materials cost and 1,600,000 of direct labor. It will require 55 hours of QC inspection time and will be shipped in 700 boxes. a. Compute the price charged for the 10,000 control units if Kato uses its traditional cost accounting system. b. Compute the price charged for the 10,000 control units if Kato uses the ABC system proposed by Ms. Inoue. 4. Explain why costs are different in the two costing systems. Include an indication of which costs you think are most accurate and why. Requirement 1. Explain how Kato, Inc., allocates its indirect production costs using its traditional cost system. Include a computation of the allocation rate used. The traditional cost system allocates indirect production costs Requirement 1. Explain how Yoshida, Inc., allocates its indirect production costs using its traditional cost system. Include a computation of the allocation rate used. The traditional cost system allocates indirect production costs based entirely on direct labor cost. Select the formula(s) and then calculate the indirect cost rate(s) under the traditional cost system. (Only use as many lines as needed to show the indirect cost rate(s) used under the traditional cost system. Round the rate(s) to two decimal places, XX.) Indirect cost rate formula Indirect cost rate Choose from any list or enter any number in the input fields and then click Check Answer OXO budget.) In 20X0 the Automotive Controls units, use 590 quality control hou Read the requirements Assembly costs Direct labor cost Direct materials cost Indirect production costs Number of boxes shipped Number of control units QC hours Quality control costs Receiving costs Shipping costs shida, Inc., allocates its indirect production costs using its traditional cost system. Inclu ates indirect production costs based entirely on direct labor cost. alculate the indirect cost rate(s) under the traditional cost system. (Only use as many ystem. Round the rate(s) to two decimal places, .XX.) te formula Indirect cost rate nds of Japanese (Click the icon to view the ABC data.) In 20X0 the Automotive Controls Department expects to produce 92,000 control units, use 590 quality control hours, and ship 8,500 boxes. Read the requirements. 20x0 budget for the automotive yen): (Click the icon to view the 2 Assembly costs Direct labor cost Direct materials cost Indirect production costs Requirement 1. Explain how Y1 Number of boxes shipped The traditional cost system alloc Number of control units QC hours Select the formula(s) and then Quality control costs used under the traditional cost & Receiving costs Indirect cost r: Shipping costs production costs using its traditional cost system. Include a computation of the allocation rate used. ased entirely on direct labor cost. under the traditional cost system. (Only use as many lines as needed to show the indirect cost rate(s) decimal places, XX.) Indirect cost rate Choose from any list or enter any number in the input fields and then click Check

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered 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

Students also viewed these Accounting questions

Question

Why would a person fear success?

Answered: 1 week ago