Question
In order to compare WoolCos current traditional method with activity-based costing, you interview the production staff and compile the following information, which relates only to
In order to compare WoolCos current traditional method with activity-based costing, you interview the production staff and compile the following information, which relates only to the costs for raw wool and wool yarn. WoolCo wishes to consider costing only for these two products at this time, since they are more established and have more data to evaluate.
Type of Cost | Activity Base | Total Cost |
Sorting | Hours of sorting | $25,600 |
Cleaning | Units of cleaning machine power | 39,600 |
Combing | Hours of combing machine use | 1,200 |
Raw Wool | Wool Yarn | |
Hours of sorting required | 1,500 | 3,500 |
Units of cleaning machine power required | 1,800 | 4,200 |
Hours of combing machine use required | 70 | 30 |
In the following table, compute and enter the activity rate for each of the three activities. If required, round your answers to the nearest cent.
Activity | Activity Rate | |
Sorting | per sorting hour | |
Cleaning | per unit of cleaning machine power | |
Combing | per hour of combing machine use |
Points:
0 / 3
In the following table, allocate the costs of sorting, cleaning, and combing based on the rates of activity consumed by each products process. When required, round your answers to the nearest dollar.
Raw Wool | Wool Yarn | |
Sorting cost | $ | $ |
Cleaning cost | ||
Combing cost | ||
Total cost | $ | $ |
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