Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Please explain and much appreciated. Ellix Company manufactures two models of ultra-high fidelity speakers-the 200 model and the X99 model. Data regarding the two products
Please explain and much appreciated.
Ellix Company manufactures two models of ultra-high fidelity speakers-the 200 model and the X99 model. Data regarding the two products follow: Additional information about the company follows: a. Model X200 requires $39 in direct materials per unit, and model X99 requires $29. b. The direct labor workers are paid $20 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: 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 tc 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. 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.) 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.) 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 poolStep 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