Answered step by step
Verified Expert Solution
Question
1 Approved Answer
ok Ellix Company manufactures two models of ultra-high fidelity speakers-the X200 model and the X99 model. Data regarding the two products follow: Product x200
ok Ellix Company manufactures two models of ultra-high fidelity speakers-the X200 model and the X99 model. Data regarding the two products follow: Product x200 X99 Direct Labor-Hours 0.6 DLs per unit 0.8 DLs per unit Annual Production Total Direct Labor-Hours 22,000 units 36,000 units 13,200 DLH 28,800 DLH 42,000 DLHS Additional information about the company follows: a. Model X200 requires $40 in direct materials per unit, and model X99 requires $26. b. The direct labor workers are paid $40 per hour. c. The company has always used direct labor-hours as the allocation base for applying manufacturing overhead cost to products. d. Model X200 is more complex to manufacture than model X99 and requires the use of special equipment. e. Because of the special work required in (d) above, the company is considering the use of activity-based absorption costing to apply manufacturing overhead cost to products. Three activity cost pools have been identified as follows: Estimated Total Activity Coat Pool Machine setups Special processing General factory Activity Measure Number of setups Machine-hours Cost X200 $177,500 360,400 Direct labor-hours 2,940,000 $3,477,900 100 1,060 13,200 Estimated Total Activity X99 150 Total 250 0 1,060 28,800 42,000 Required: 1. Assume that the company continues to use direct labor-hours as the allocation base for applying overhead cost to products. a. Compute the plantwide predetermined overhead rate. b. Compute the unit product cost of each model. 2. Assume that the company decides to use activity-based absorption costing to apply overhead cost to products. a. Compute the activity rate for each activity cost pool and determine the amount of overhead cost that would be applied to each model using the activity-based approach. b. Compute the unit product cost of each model. Complete this question by entering your answers in the tabs below. Req 1A Req 18- Req 2A Part 1 Req 2A Part 2 Req 28 Assume that the company continues to use direct labor-hours as the allocation base for applying overhead cost to products. Compute the plantwide predetermined overhead rate. (Round your answer to 2 decimal places.) Predetermined overhead rate per DLH Reg IA Req 18 > Product x200 X99 Direct Labor-Hours 0.6 DLHs per unit 0.8 DLHS per unit Annual Production Total Direct Labor-Hours 13,200 DLHS 22,000 units 36,000 units 28,800 DLHS 42,000 DLHS Additional information about the company follows: a. Model X200 requires $40 in direct materials per unit, and model X99 requires $26. b. The direct labor workers are paid $40 per hour. c. The company has always used direct labor-hours as the allocation base for applying manufacturing overhead cost to products. d. Model X200 is more complex to manufacture than model X99 and requires the use of special equipment. e. Because of the special work required in (d) above, the company is considering the use of activity-based absorption costing to apply manufacturing overhead cost to products. Three activity cost pools have been identified as follows: Estimated Total Cost $177,500 360,400 x200 100 Estimated Total Activity X99 150 Total 250 1,060 0 1,060 13,200 28,800 42,000 Activity Cost Pool Machine setups Special processing General factory Activity Measure Number of setups Machine-hours Direct labor-hours 2,940,000 $ 3,477,900 Required: 1. Assume that the company continues to use direct labor-hours as the allocation base for applying overhead cost to products. a. Compute the plantwide predetermined overhead rate. b. Compute the unit product cost of each model. 2. Assume that the company decides to use activity-based absorption costing to apply overhead cost to products. a. Compute the activity rate for each activity cost pool and determine the amount of overhead cost that would be applied to each model using the activity-based approach. b. Compute the unit product cost of each model. Complete this question by entering your answers in the tabs below. Req 1A Req 18: Req 2A Part 1 Req 2A Part 2 Req 28 Assume that the company continues to use direct labor-hours as the allocation base for applying overhead cost to products. Compute the unit product cost of each model. (Round "Predetermined overhead rate to nearest dollar amount. Round other intermediate calculations and final answers to 2 decimal places.) Model X200 X99 Unit product cost Product x200 X99 Direct Labor-Hours 0.6 DLHS per unit 0.8 DLHs per unit Annual Production Total Direct Labor-Hours 22,000 units 36,000 units 13,200 DLH 28,800 DLHS 42,000 DLHS Additional information about the company follows: a. Model X200 requires $40 in direct materials per unit, and model X99 requires $26. b. The direct labor workers are paid $40 per hour. c. The company has always used direct labor-hours as the allocation base for applying manufacturing overhead cost to products. d. Model X200 is more complex to manufacture than model X99 and requires the use of special equipment. e. Because of the special work required in (d) above, the company is considering the use of activity-based absorption costing to app manufacturing overhead cost to products. Three activity cost pools have been identified as follows: Activity Cost Pool Machine setups Special processing General factory Activity Measure Number of setups Machine-hours Direct labor-hours Estinated Total Cost $177,500 360,400 2,940,000 Estimated Total Activity x200 100 1,060 13,200 x99 150 Total 250 28,800 1,060 42,000 $ 3,477,900 Required: 1. Assume that the company continues to use direct labor-hours as the allocation base for applying overhead cost to products. a. Compute the plantwide predetermined overhead rate. b. Compute the unit product cost of each model. 2. Assume that the company decides to use activity-based absorption costing to apply overhead cost to products. a. Compute the activity rate for each activity cost pool and determine the amount of overhead cost that would be applied to each model using the activity-based approach. b. Compute the unit product cost of each model. Complete this question by entering your answers in the tabs below. Req LA Req 18 Req 2A Part 1 Req 2A Part 2 Req 28 Assume that the company decides to use activity-based absorption costing to apply overhead cost to products. Compute the activity rate for each activity cost pool. Activity Cost Pool Machine setups Special processing General factory Activity Rate per setup per MH per DLH Required Homework Product X200 X99 Direct Labor-Hours 0.6 DLHS per unit 0.8 DLHB per unit Annual Production 22,000 units 36,000 units Total Direct Labor-Hours 13,200 DLBS 28,800 DLHS 42,000 DLHS Saved Additional information about the company follows: a. Model X200 requires $40 in direct materials per unit, and model X99 requires $26. b. The direct labor workers are paid $40 per hour. c. The company has always used direct labor-hours as the allocation base for applying manufacturing overhead cost to products. d. Model X200 is more complex to manufacture than model X99 and requires the use of special equipment. e. Because of the special work required in (d) above, the company is considering the use of activity-based absorption costing to apply manufacturing overhead cost to products. Three activity cost pools have been identified as follows: Activity Cost Pool Machine setups Special processing General factory Activity Measure Number of setups Machine-hours Estinated Total Coat $177,500 X200 100 Estimated Total Activity X99 150 Total 250 Direct labor-hours 360,400 2,940,000 1,060 0 13,200 28,800 1,060 42,000 $ 3,477,900 Required: 1. Assume that the company continues to use direct labor-hours as the allocation base for applying overhead cost to products. a. Compute the plantwide predetermined overhead rate. b. Compute the unit product cost of each model. 2. Assume that the company decides to use activity-based absorption costing to apply overhead cost to products. a. Compute the activity rate for each activity cost pool and determine the amount of overhead cost that would be applied to each model using the activity-based approach. b. Compute the unit product cost of each model. Complete this question by entering your answers in the tabs below. Req 1A Req 18 Req 2A Part 1 Req 2A Part 2 Req 28 Assume that the company decides to use activity-based absorption costing to apply overhead cost to products. Determine the amount of overhead cost that would be applied to each model using the activity-based approach. (Round "Overhead cost per unit answers to 2 decimal places.) Total overhead cost Overhead cost per unit Model X200 Model X99 A Required Homework Product X200 X99 Direct Labor-Bours 0.6 DLHS per unit 0.8 DLHS per unit Annual Production 22,000 units 36,000 units Total Direct Labor-Hours 13,200 DLH 28,800 DL 42,000 DLHS Saved Additional information about the company follows: a. Model X200 requires $40 in direct materials per unit, and model X99 requires $26. b. The direct labor workers are paid $40 per hour. c. The company has always used direct labor-hours as the allocation base for applying manufacturing overhead cost to products. d. Model X200 is more complex to manufacture than model X99 and requires the use of special equipment. e. Because of the special work required in (d) above, the company is considering the use of activity-based absorption costing to appli manufacturing overhead cost to products. Three activity cost pools have been identified as follows: Activity Cost Pool Machine setups Special processing General factory Activity Measure Number of setups Machine-hours Direct labor-hours Estimated Total Cost $177,500 360,400 2,940,000 Estimated Total Activity x200 100 1,060 13,200 X99 150 0 Total 250 1,060 28,800 42,000 $ 3,477,900 Required: 1. Assume that the company continues to use direct labor-hours as the allocation base for applying overhead cost to products. a. Compute the plantwide predetermined overhead rate. b. Compute the unit product cost of each model. 2. Assume that the company decides to use activity-based absorption costing to apply overhead cost to products. a. Compute the activity rate for each activity cost pool and determine the amount of overhead cost that would be applied to each model using the activity-based approach. b. Compute the unit product cost of each model. Complete this question by entering your answers in the tabs below. Req 1A Req 18 Req 2A Part 1 Req 2A Part 2 Re 28 Assume that the company decides to use activity-based absorption costing to apply overhead cost to products. Compute the unit product cost of each model. (Round your intermediate calculations and final answers to 2 decimal places.) Unit product cost of Model X200 Unit product cost of Model X99 Reg 24 Part 2.
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