Question
Johoston Corp manufactures computer desks in its Buffalo New York, plant. The company uses activity based costing to allocate all manufacturing conversion costs (direct
Johoston Corp manufactures computer desks in its Buffalo New York, plant. The company uses activity based costing to allocate all manufacturing conversion costs (direct labor and manufacturing overhead). Its actives and aed data fuo Data table X Requirements Budgeted Cost Cost Allocation Activity of Activity Allocation Base Rate Materials handling 3 270.000 Number of parts $ 0.70 Assembling 2.200.000 Direct labor hours $ 15.00 5.00 $ Painting 100.000 Number of painted desks S Johnston produced two styles of desks in March the Standard desk and Unpainted desk. Data for each follow Total Units Product Total Direct Produced Materials Costs Total Number Total Assembling of Parts Direct Labor Hours Standard desk 6.000 S 147450 121,500 6,100 Unpainted desk... 2.500 $ 27450 31.300 1,200 1. Compute the per-unit manufacturing product cost of Standards and Unpainted desk 1facturing activites, such as product design, were assigned to the dard desks at $5 each and to the Unpainted desks at 54 walyses were conducted of poet-manufacturing activities such as datribuoh, marketing, and customer service. The post-manufacturing costs were $23 per Standard and $20 per Unpaired desk Compute the full product costs per desk 3. Which product costs are reported in the external financial statements? Which costs are used for management decision making? Explain the offeronce 4. What price should Johnston's managers set for Standard desks to eam a 541 proft per desk? Print Done Print Done
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