Question
Hair by Zeus Bottle Batch Cost per January' s other expenses Oil, fl. oz. 2 $3 Supervision $8,000 Lotion, fl. oz. 4 $1 Indirect materials
Hair by Zeus Bottle Batch Cost per January' s other expenses Oil, fl. oz. 2 $3 Supervision $8,000 Lotion, fl. oz. 4 $1 Indirect materials $2,200 Zeus potion, fl. oz. 1/4 $24 Equipment deprec & repairs $14,520 Alcemena scent 1/16 $48 Plant manager's salary $6,500 Bottle, cap, label 1 $0.4 Utilities $1,800 Direct labor, hour 50 $14 $33,020 Machine hours 8
HHRI appoints a new CEO, who decides to increase production targets to 200 batches per year. She also hires a management accountant who decides to apply normal costing and does some research into cost behavior. Basic product data still applies. New information appears below. Require: If HHRI uses a plant-wide rate based on a single cost pool, please calculate full cost for both machine hours and direct labor hours. (10 points) Hint: When a single cost pool is used, the planned cost per batch is the same whichever cost driver is employed, because ultimately, all overheads have to be charged to production
Estimated overheads for year % fixed Supervision $96,000 100% Indirect materials $30,800 60% Equipment depreciation $126,240 100% Equipment repairs $48,000 30% Plant manager's salary $84,500 100% Utilities $27,000 20% $412,540
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Hercules Hair Restorer Inc. (HHRI) makes many varieties of hair restoration products which are sold under well-known marketing labels. A single batch contains 10,000 8 oz. bottles and takes two days to make. Typically 15 batches are completed per month, for different brands. Basic cost data for the month of January appears below Hair by Zeus Oil, fl. oz. Lotion, fl January's other Bottle Batchl per S3 Supervision $8,000 S1 terials $2,200 Zeus potion, fl 1/4 S24 S14,520 scent 1/16 S48 cap, label1 Direct $0.4 Utilities $1,800 hour Machine 50 S14 S33,020Step by Step Solution
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