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eBook Activity-based product costing Instructions Activity Table - Alpha Activity Table - Beta Activity Table - Omega Final Question Instructions Mello Manufacturing Company is a diversified manufacturer that manufactures three products (Alpha, Beta, and Omega) in a continuous production process. Senior management has asked the controller to conduct an activity based costing study. The controler identified the amount of factory overhead required by the critical activities of the organization as follows: Activity 1 Production Activity Cost Pool 5232.850.00 96.585.00 9.660.00 Setup Material handling Inspection Product engineering Total 52.36400 17102200 556906100 The activity bases de lied for each activity we as follows: Activity Production S Material harding Inspection Product engineering Activity Base Machine hours Number of seluas Number of parts Number of inspection hours Number of engineenng hours Instructions Activity Table - Alpha Activity Table Beta Activity Table - Omega Final Question Instructions Inspection Number of inspection hours Product engineering Number of engineering hours The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows: Machine Number of Number of Number of Number of Hours Setups Parts Inspection Hours Engineering Hours Units Alpha 901 62 73 428 134 1,245 Bota 773 117 156 313 191 918 Omega 421 232 254 247 213 520 Total 2,095 411 483 988 538 2,683 Each product requires 40 minutes per unit of machine time. Required: Complete the Activity Tables for Alpha, Beta and Omega 1. Determine the activity rate for each activity 2 Use the activity rates in () to determine the total and per-unit activity costs associated with all the products 3 Why aren't the activity unit costs equal across all three products since they require the same machine time per unit? "Frequired, round all per unit amounts to the nearest cont Shaded cells have structions Activity Table - Alpha Complete the Activity Table for Alpha 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns 2. Use the activity rates in (1) to determine the total and per-unit activity costs associated with Alpha." "If required, round all per-unit amounts to the nearest cont. a all Alpha Activity Activity Base Activity Activity Usage Rate Cost Production mh S Imh Setup setups S Isetup Material handling parts s part Th Inspection Insp. hours /hour Product Engineering eng hours 5 Thour Total activity cost Number of units Activity cost per unit Points 10 DA Activity-based product costing Instructions Activity Table - Alpha Activity Table - Beta Activity Table - Omega Final Question Shaded colls have feedback Instructions Activity Table - Alpha MA Activity Table - Beta 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns 2. Use the activity rates in (1) to determine the total and per unit activity costs associated with Beta. *if required, round all per-unit amounts to the nearest cont Shaded cells have feedbac ha toll P S M Beta in Activity Activity Baso Activity Activity Usage X Rate Cost Production mh imh v A Setup setups Isetup Matenal handling parts 1 part Th Inspection insp. hours 1 /hour Product Engineering eng hours Ihour Total activity cost Number of units Activity cost per unit AI eBook Instructions Activity Table - Alpha Activity Table - Beta Activity Table - Omega Final Question ME Shaded cells ha Shaded cell Instructions Activity Table - Alpha Activity Table - Beta Activity Table - Omega Complete the Activity Table for Omega 1. Determine the activity rate for each activity. Enter these rates in the Activity Rate columns 2 Use the activity rates in (1) to determine the total and per-unit activity costs associated with Omega." *if required, round all per unit amounts to the nearest cent. Shaded cells have fee Omega Activity: Activity Base Activity Activity Usage Rate Cost Production mh $ Imh Setup setups $ Isetup Material handling parts 5 part Inspection Insp. hours S /hour Product Engineering eng hours S Thour Total activity cost Number of units Activity cost per unit Shaded Instructions Activity Table - Alpha Me Activity Table - Beta Activity Table - Omega Final Question Sh Shaded cells Shaded cells have feedback 3. Why aren't the activity unit costs equal across all three products since they require the same machine time per unit? VO The difference is because the products consumo many activities in ratios different from the volume. The difference is due to machine inefficienclos. The difference is due to product cost distortions, Points: P SI Material handling Darts
