Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Jamesway Corporation makes two types of replacement fittings for heavy construction equipment-screws and bolts. Data regarding the two products follow: Direct Labour- Hours per Unit
Jamesway Corporation makes two types of replacement fittings for heavy construction equipment-screws and bolts. Data regarding the two products follow: Direct Labour- Hours per Unit 0.20 0.10 Screws Bolts Annual Production 40,000 units 60,000 units Additional information about the company follows: a. Screws require $8.95 in direct materials per unit, and bolts require $6.95. b. The direct labour wage rate is $45 per hour. C. Screws are more complex to manufacture than bolts, and they require special equipment. d. The ABC system has the following activity cost pools: Activity Cost Pool Machine setups Special processing General factory Activity Measure Number of setups Machine-hours Direct labour-hours Estimated Overhead Cost $ 29,400 $236,000 $609,000 Screws 80 4,000 7,000 Activity Bolts 40 0 14,000 Total 120 4,000 21,000 Required: 1. Compute the activity rate for each activity cost pool. Activity Rate Activity Cost Pool Machine setups Special processing General factory per setup per MH per DLH 2. Determine the unit cost of each product according to the ABC system, including direct materials and direct labour. (Round your answers to 2 decimal places.) Screws Bolts Direct materials Direct labour Overhead Unit cost
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started