Question
Please show work. Boudoin Corporation manufactures two products: Product T72T and Product L34S. It is considering implementing an activity-based costing (ABC) system that allocates all
Please show work.
Boudoin Corporation manufactures two products: Product T72T and Product L34S. It is considering implementing an activity-based costing (ABC) system that allocates all of its manufacturing overhead to four cost pools. The following additional information is available for the company as a whole and for Products T72T and L34S.
|
| Activity Cost Pool | Activity Measure | Total Cost | Total Activity | |
|
| Machining | Machine-hours | $345,000 | 15,000 | MHs |
|
| Machine setups | Number of setups | $180,000 | 450 | setups |
|
| Product design | Number of products | $94,000 | 2 | products |
|
| General factory | Direct labor-hours | $280,000 | 10,000 | DLHs |
|
| Activity Measure | Product T72T | Product L34S |
|
| Machine-hours | 8,000 | 7,000 |
|
| Number of setups | 320 | 130 |
|
| Number of products | 1 | 1 |
|
| Direct labor-hours | 4,000 | 6,000 |
Required:
a. Using the ABC system, how much total manufacturing overhead cost would be assigned to Product T72T?
b. Using the ABC system, what percentage of the total overhead cost is assigned to Product L34S?
Step 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
Selected Chapters From Managerial Accounting Creating Value In A Dynamic Business Environment
Authors: Ronald W. Hilton
Edition
0073043346, 978-0073043340
