Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

plz help me out with 3 4 and 5 part i know how to do 1st and 2nd The local bakery has been using job

plz help me out with 3 4 and 5 part i know how to do 1st and 2nd

The local bakery has been using job order costing and is deciding whether to use activity-based costing. The bakery makes many different products, including the one you produced in the job order costing project. In this project, you will calculate the unit product cost under activity-based costing for the same bakery product you produced in the job order costing project.

Project Data:

The bakery has identified the following activity cost pools, cost drivers, and total yearly quantity for the cost drivers, and percentage of total estimated manufacturing overhead cost allocated to each cost pool. The bakery estimates $50,000 in total manufacturing overhead.

Activity Cost Pool Data

Activity Cost Pool

Cost Driver

Cost Driver Quantity

Percent of Total Manufacturing Overhead

Materials Ordering and Inspection

Number of purchase orders

1,500 orders

30%

Equipment Setup

Number of setups

750 setups

30%

Quality Control

Number of inspections

2,500 inspections

25%

Other

Number of direct labor hours

10,000 hours

15%

Project Requirements:

Calculate total manufacturing overhead cost allocated to each activity cost pool.

Calculate the activity rate for each activity cost pool.

Estimate the cost driver quantity allocated to your bakery product from the job order costing project.Note: This will not be the entire cost driver quantity as the bakery makes many different products. Determine a reasonable estimate based on your product.

Calculate manufacturing overhead allocated in the year to your bakery product.

Estimate total units produced in the year and calculate manufacturing overhead per unit.

Using direct materials per unit and direct labor per unit from the job order costing project, calculate unit product cost.

In a few sentences, explain the differences in unit product cost between job order and activity-based costing.

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

The Routledge Handbook Of Critical Finance Studies

Authors: Christian Borch, Robert Wosnitzer

1st Edition

1138079812, 978-1138079816

More Books

Students also viewed these Finance questions