Question
Good morning, Can you help answer a managerial accounting question? I need help answering this question Phoenix Company makes custom covers for air conditioning units
Good morning,
Can you help answer a managerial accounting question? I need help answering this question
Phoenix Company makes custom covers for air conditioning units for homes and businesses. The company uses an activity-based costing system for its overhead costs. The company has provided the following data concerning its annual overhead costs and its activity cost pools:
Overhead Costs:
Production overhead
$100,000
Office expenses
50,000
Total
$150,000
Distribution of Resource Consumption:
Activity Cost Pools
Making Covers
Job Support
Other
Total
Production overhead
40%
42%
18%
100%
Office expenses
12%
60%
28%
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
Annual Activity
Making covers
2,500 yards
Job support
200 jobs
Other
Not applicable
Required:
a) Prepare the first-stage allocation of overhead costs to the activity cost pools by filling in the table below:
Making Covers
Job Support
Other
Total
Production overhead
Office expense
Total
b) Compute the activity rates (i.e., cost per unit of activity) for the Making Covers and Job Support activity cost pools by filling in the table below:
Making Covers
Job Support
Production overhead
Office expense
Total
c)Help me report in good form of a job that involves making 50 yards of covers and has direct materials and direct labour cost of $1,500. The sales revenue from this job is $2,500.
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