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How to do this? Several years after reengineering its production process. King Corporation hired a new controller. Barb Joe She developed an ABC system very
How to do this? Several years after reengineering its production process. King Corporation hired a new controller. Barb Joe She developed an ABC system very similar to the one used by King's chief rival. Greengrass Part of the reason Joe developed the ABC system was because King's profits had been declining even though the company had shifted its product mix toward the product that had appeared most profitable under the old system Before adopting the new ABC system King had used a plantwide overhead rate based on direct labor hours that was developed years ago For the upcoming year. Kings budgeted ABC manufacturing overhead allocation rates are as follows (Click the icon to view the additional data ) The number of parts is now a feasible allocation base because King recently installed a plantwide computer system King produces two wheel models Standard and Deluxe Budgeted data for the upcoming year are as follows (Click the icon to view the additional data )Compute the total budget manufacturing overhead cost for the upcoming year.Requirement 2. Compute the manufacturing overhead cost per wheel of each model using ABC.Requirement 3. Compute King's traditional plantwide overhead rate. Use the rate to determine the manufacturing overhead cost per wheel under the traditional system. Begin by identifying the formula to compute the current plantwide manufacturing overhead rate, then compute the rate.Now use the plantwide overhead rate to determine the manufacturing overhead cost per wheel. Several years after reengineering its production process. King Corporation hired a new controller. Barb Joe She developed an ABC system very similar to the one used by King's chief rival. Greengrass Part of the reason Joe developed the ABC system was because King's profits had been declining even though the company had shifted its product mix toward the product that had appeared most profitable under the old system Before adopting the new ABC system King had used a plantwide overhead rate based on direct labor hours that was developed years ago For the upcoming year. Kings budgeted ABC manufacturing overhead allocation rates are as follows (Click the icon to view the additional data ) The number of parts is now a feasible allocation base because King recently installed a plantwide computer system King produces two wheel models Standard and Deluxe Budgeted data for the upcoming year are as follows (Click the icon to view the additional data )Compute the total budget manufacturing overhead cost for the upcoming year.Requirement 2. Compute the manufacturing overhead cost per wheel of each model using ABC.Requirement 3. Compute King's traditional plantwide overhead rate. Use the rate to determine the manufacturing overhead cost per wheel under the traditional system. Begin by identifying the formula to compute the current plantwide manufacturing overhead rate, then compute the rate.Now use the plantwide overhead rate to determine the manufacturing overhead cost per wheel
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