Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Nivag's Netballs is a manufacturer of high quality basketballs and volleyballs. It uses activity based costing (ABC) system. Tree indirect cost categories (activities) and their

image text in transcribed Nivag's Netballs is a manufacturer of high quality basketballs and volleyballs. It uses activity based costing (ABC) system. Tree indirect cost categories (activities) and their cost drivers are as follows: - Setup costs are driven by the number of batches. Equipment and maintenance costs increase with the number of machine-hours. Rent is paid per square meter (m). Capacity of the facility is 8,400 m. The following is the budgeted direct cost and indirect cost information for Nivag: Direct materials Direct manufacturing labor Setup cost Direct Costs Basketballs Volleyballs $209,750 107,333 $ 358,290 102,969 Indirect Costs $ 143,500 109,900 151,200 Equipment and maintenance costs Rent Other budgeted information follows. Basketballs Volleyballs Number of balls Machine hours 66,000 11,000 100,000 12,500 Number of batches 300 400 Area of production space used (m) 3,360 5,040 (For each item below select from the drop-down list.) a) What is the budgeted setup cost allocation rate (setup cost per batch)? Ans. = $ b) How much of the rent costs are allocated to basketballs? Ans. = $ c) What is the budgeted total cost of producing basketballs? Ans. = $

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Accounting

Authors: Joe Ben Hoyle, Thomas Schaefer, Timothy Doupni

13th edition

1259444953, 978-1259444951

More Books

Students also viewed these Accounting questions

Question

What is trust, and how does it relate to justice and ethics?

Answered: 1 week ago