Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

please answer the last part. part (c) Current Attempt in Progress Altex Inc. manufactures two products: car wheels and truck wheels. To determine the amount

please answer the last part. part (c) image text in transcribed
image text in transcribed
image text in transcribed
image text in transcribed
Current Attempt in Progress Altex Inc. manufactures two products: car wheels and truck wheels. To determine the amount of overhead to assign to each product line, the controller, Robert Hermann, has developed the following information. Estimated wheels produced Direct labor hours per wheel Car 43,000 1 Truck 11,000 3 Total estimated overhead costs for the two product lines are $881,600. (a 1) Your answer is correct Calculate overhead rate. (Round answer to 2 decimal places, s. 12.25.) Overhead rate $ 11.60 per direct labor hour (a2) Your answer is correct. Compute the overhead cost assigned to the car wheels and truck wheels, assuming that direct labor hours is used to allocate overhead costs Car wheels $ 498.800 Truck wheels $ 382,800 (b) Your answer is correct Hermann is not satisfied with the traditional method of allocating overhead because he believes that most of the overhead costs relate to the truckwheels product line because of its complexity. He therefore develops the following three activity cost pools and related cost drivers to better understand these costs. Estimated Use of Estimated Overhead Activity Cost Pools Cost Drivers Costs Setting up machines 1,000 setups $228,000 Assembling 76,000 labor hours 380,000 Inspection 1.200 inspections 273,600 Compute the activity-based overhead rates for these three cost pools. Overhead Rates Setting up machines 228.00 Assembling $ $ $ 5.00 Inspection 228.00 (c) Your answer is incorrect Compute the cost that is assigned to the car wheels and truck wheels product lines using an activity-based costing system, given the following information Estimated Use of Cost Drivers per Product Truck Number of setups 200 800 33,000 Number of inspections Car Direct labor hours 43.000 100 1.100 Car Wheels Truck Wheels Setting up machines S 1 $ Assembling $ $ Inspection S $ Total cost assigned $ $

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

Step: 3

blur-text-image

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

An Introduction To Modern Financial Reporting Theory

Authors: Brian A Rutherford

1st Edition

9780761966074

More Books

Students also viewed these Accounting questions

Question

=+b) What are the standard deviations for each action?

Answered: 1 week ago