PLEASE HELP ALL QUESTIONS MY DEAR FRIEND NOT ONE STRUGGLED

1. Terry Industries produces two electronic decoders, P and Q. Decoder P is more sophisticated and requires more programming and testing than does Decoder Q. Because of these product differences, the company wants to use activity-based costing to allocate overhead costs. It has identified four activity pools. Relevant information follows.

Activity Pools

Cost Pool Total

Cost Driver

Repair and maintenance on assembly machine

$

84,800

Number of units produced

Programming cost

98,400

Number of programming hours

Software inspections

9,280

Number of inspections

Product testing

11,220

Number of tests

Total overhead cost

$

203,700

Expected activity for each product follows.

	Number of Units		Number of Programming Hours		Number of Inspections		Number of Tests
Decoder P	16,000		1,700		193		1,200
Decoder Q	37,000		2,300		127		2,100
Total	53,000		4,000		320		3,300

Required:

a.

a.Compute the overhead rate for each activity pool. (Round your answers to 2 decimal places.

Allocation Rate

Activity Pools Decoder P Decoder Q

repair and maintenance on assembly machine

programming cost

software inspections

product testing

b.

Determine the overhead cost allocated to each product. (Round intermediate calculations to 2 decimal places.)

total allocated cost

Decoder P

Decoder Q

2. Spiro Company produces commercial gardening equipment. Since production is highly automated, the company allocates its overhead costs to product lines using activity-based costing. The costs and cost drivers associated with the four overhead activity cost pools follow.

Activities
		Unit Level	Batch Level	Product Level	Facility Level
	Cost	$57,200	$17,860	$12,000	$221,000
	Cost driver	2,600 labor hrs.	38 setups	Percentage of use	17,000 units

Production of 730 sets of cutting shears, one of the companys 20 products, took 210 labor hours and 10 setups and consumed 10 percent of the product-sustaining activities.

Required:

a.

Had the company used labor hours as a companywide allocation base, how much overhead would it have allocated to the cutting shears? (Round intermediate calculations to 2 decimal places and final answer to the nearest dollar amount.) b. How much overhead is allocated to the cutting shears using activity-based costing? (Round your answer to the nearest dollar amount.) c. Compute the overhead cost per unit for cutting shears first using activity-based costing and then using direct labor hours for allocation if 730 units are produced. If direct product costs are $190 and the product is priced at 35 percent above cost, for what price would the product sell under each allocation system? (Round intermediate calculations and final answers to 2 decimal places.) ABC Labor Hrs Allocated overhead direct cost total cost per unit desired profit sales price

Gerald Boards produces two kinds of skateboards. Selected unit data for the two boards for the last quarter follow.

	Basco Boards			Shimano Boards
Production costs
Direct materials	$	24.60		$	37.20
Direct labor	$	30.60		$	52.20
Allocated overhead	$	15.30		$	19.20
Total units produced and sold		4,600			8,600
Total sales revenue	$	400,200		$	1,083,600

Gerald allocates production overhead using activity-based costing. It allocates delivery expense and sales commissions, which amount to $57,000 per quarter, to the two products equally.

Required:
a.	Compute the per-unit cost for each product. (Round your answers to 2 decimal places.) Basco Boards Shimano boards cost per unit b. Compute the profit for each product. Basco Boards shimano boards profit