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Please answer E18-22 and E18-23 LO2, 3, 4 E18-22. Activity-Based Costing and Traditional Costs Compared Cuisinart, a Conair Corporation, manufactures outdoor gas cookers and charcoal
Please answer E18-22 and E18-23 LO2, 3, 4 E18-22. Activity-Based Costing and Traditional Costs Compared Cuisinart, a Conair Corporation, manufactures outdoor gas cookers and charcoal smokers. Corporation Assume that Cuisinart only makes a single model of each product and that the following informa- tion pertains to the total manufacturing costs for the products in the current month. Conair Units Number of batches Number of machine hours Direct materials. Direct labor Gas Cooker 4,000 80 16,000 $225,500 $100,683 Charcoal Smoker 3,500 35 3,000 $108,500 $50,341 Manufacturing overhead follows: Activity Materials acquisition and inspection... Product assembly... Scheduling .... Cost Cost Driver $ 50,100 Amount of direct materials cost 123,500 Number of machine hours 15,180 Number of batches $188,780 REQUIRED 4. Determine the total and per-unit costs of manufacturing the Gas Cooker and Charcoal Smoker for the month, assuming all manufacturing overhead related to these two products is assigned on the basis of direct labor dollars. Cambridge Business Publishers Chapter 18 Adivity-Based Costing. Customer Profitability, and Activity-Based Management 869 LO1, 3, 4 b. Determine the total and per-unit costs of manufacturing the Gas Cooker and Charcoal Smoker for the month, assuming manufacturing overhead is assigned using activity-based costing. E18-23. Activity-Based Costing Versus Traditional Costing Refer to the previous exercise in E18-22 for Cuisinart. REQUIRED Comment on the differences between the solutions to requirements (a) and (b). Which is more accurate? What eros might managers make if all manufacturing overhead costs are assigned on the basis of direct labor dollars? b. Cuisinart's manufacturing process has become increasingly automated over the past few years Discuss how this will likely impact its ability to accurately measure product costs. Comment on the adequacy of the preceding data to meet management's needs
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