Question
Physical Flow, Equivalent Units, Unit Costs, No Beginning WIP Inventory, Activity-Based Costing, DBC McKay, Inc., produces a subassembly used in the production of hydraulic cylinders.
Physical Flow, Equivalent Units, Unit Costs, No Beginning WIP Inventory, Activity-Based Costing, DBC
McKay, Inc., produces a subassembly used in the production of hydraulic cylinders. The subassemblies are produced in three departments: Plate Cutting, Rod Cutting, and Welding. Materials are added at the beginning of the process. Overhead is applied using the following drivers and activity rates:
| Driver | Rate | Actual Usage (by Plate Cutting) | ||
|---|---|---|---|---|
| Direct labor cost | 150% of direct labor | $87,840 | ||
| Inspection hours | $40 per hour | 4,002 hours | ||
| Number of moves | $100 per move | 1,680 moves |
During the first quarter, the Plate Cutting Department used 20,900 hours (direct, indirect, and machine hours) to produce the quarter's output. Other quarterly data for the Plate Cutting Department are as follows:
| Beginning work in process, January 1 | |
| Units started | 90,000 |
| Direct materials cost | $630,000 |
| Units, ending work in process (100% materials; 64% conversion), March 31 | 6,000 |
d. According to production engineering, if efficiency were increased to an ideal level, then the cycle time should be 0.20 hours. If this were to occur, what would the cost per plate be? (round to the nearest cent)?
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