Prescott's Office Department manufactures computer desks in its Moosejaw, Saskatchewan, plant. The company uses activity based costing to allocate all manufacturing conversion costs (direct labour and manufacturing overhead). Its activities and related data follow: E (Click the icon to view the activity areas and related data.) Requirements 1. Compute the per-unit manufacturing product cost of Standard desks and Unpainted desks. 2. Premanufacturing activities, such as product design, were assigned to the Standard desks at $6 each and to the Unpainted desks at $4 each. Similar analyses were conducted of postmanufacturing activities, such as distribution, marketing, and customer service. The postmanufacturing costs were $27 per Standard and $26 per Unpainted desk. Compute the full product costs per desk. 3. Which product costs are reported in the external financial statements? Which costs are used for management decision making? Explain the difference. 4. What price should Prescott's managers set for Standard desks to earn a $48 profit per desk? Direct materials $ 99,000 $ 25,000 Materials handling 187,500 52,500 Assembling 136,400 39,600 38,350 0 Painting Total manufacturing cost $ 461,250 $ 117,100 5,000 Number of units 6,500 ? Choose from any list or enter any number in the input fields and then click Check Answer. Prescott's Office Department manufactures computer desks in its Moosejaw, Saskatchewan, plant. The company uses activity based costing to allocate all manufacturing conversion costs (direct labour and manufacturing overhead). Its activities and related data follow. (Click the icon to view the activity areas and related data.) Requirements 1. Compute the per-unit manufacturing product cost of Standard desks and Unpainted desks. 2. Premanufacturing activities, such as product design, were assigned to the Standard desks at S8 each and to the Unpainted desks at $4 cach. Similar analyses were conducted of postmanufacturing activities, such as distribution, marketing, and customer service The postmanufacturing costs were $27 per Standard and S26 per Unpainted desk Compute the full product costs per desk. 3. Which product costs are reported in the external financial statements? Which costs are used for management decision making? Explain the difference. What price should Prescott's managers set for Standard desks to earn a S48 profil per desk? A Data Table Requirement 1. Compute the per-unit manufacturing product cost of Standard desks and Unpainted desks. (For activities with a zero balance, enter "O". Roun 4. Unpainted Desk 25.000 $ 52,500 39.600 Standard Desk 99,000 $ 187,500 136,400 38,360 461,250 $ 6,500 71 $ Direct materials Materials handling Assembling Painting Total manufacturing cost Number of units Manufacturing cost per unit 0 Budgeted Cost Cost Activity of Activity Allocation Base Allocation Rate Materials handling $ 390,000 Number of parts s 1.50 3.100.000 Direct labour hours 22.00 Painting 220,000 Number of painted desks 5.90 Prescott produced two styles of desks in March: the Standard desk and the Unpainted desk Data for each follow: Assembling ... $ 117.100 5,000 23 $ Total Direct Requirement 2. Premanufacturing activities, such as product design, were assigned to the Standard desks at $ each and to the Unpainted desks al $4 each. Sir service. The postmanufacturing costs were $27 per Standard and 528 per Unpainted desk Compute the full product costs per desk Total Number Materials Total Units Produced 5,500 5,000 Total Assembling Direct Labour Hours Product of Parts Standard Deak Unpainted Desk Costs 99,000 $ Standard deak ....... Unpainted desk ... 125,000 35,000 6,200 1.800 25,000 Full product cost per unit Print Dovo Done Requirement 1.Compute the per-unit manufacturing product cost of Standard desks and Unpainted desks. (For activities with a zero balance, enter "o". Round your answers to the nearest whole dollar.) Standard Desk Unpainted Desk Direct materials Materials handling Assembling Painting Total manufacturing cost Number of units Manufacturing cost per unit Standard Desk Unpainted Desk Full product cost per unit Requirement 3. Which product costs are reported in the external financial statements? Which costs are used for management decision making? Explain the difference. are reported in the financial statements Managers use for decisions such as pricing and product emphasis. Full product costs include the that are expensed as incurred for external reporting. However, these costs Requirement 4. What price should Owen's managers set for Standard desks to earn Sales price per unit - standard desk Show transcribed image text