Problem 4-1A a e (Video) Combat Fire, Inc. manufactures steel cylinders and nozzles for two models of fire extingquishers: (1) a home fire extinquisher and (2) a commercial fire extinguisher. The home model is a high-volume (54,000 units), half-gallon cylnder that holds 2 1/2 pounds of multi purpose dry chemical at 480 PS. The commercial model is a low volume (10,200 units), two-galon cylinder that holds 10 paunds of multi-purpese dr chemical at 390 PSI. Both products require 1.5 hours of direct labor for completion. Therefore, total annual direct labor hours are 96,300 or 11.5 hours x (54,000 4 10,200)]. Estimated annual manufacturing overhead is $1,581,808. Thus, the predetermined overhead rate is $16.43 or ($1,581,808 96,300) per direct labor hour. The direct materials cost per unit is $18.50 for the home model and $26.50 for the commercial model, The direct labor cost is $19 per unit for both the home and the commercial models The company's managers identified six activity cost pools and related cost drivers and accumulated overhead by cost pool as follows, Estimated Use of Drivers by Product Estimated Use of Cost Drivers Activity Cost Pools Cost Drivers Estimated Overhead Home Commercial Receiving Pounds $87,100 335,000 215,000 120,000 Forming Machine hours 152,950 27,000 35,000 8.000 Number of parts Assembling 410,130 217,000 165.000 52.000 Number of tests Testing 53,040 25,500 15,500 10,000 Painting Gallens 57,838 5,258 3.680 1,578 Packing and shipping Founds 820,750 335,000 215,000 120,000 $1,581,808 Under tradtional product costing, compute the total unit cost of each product. (Round answers to 2 decimal places, e.g 12.50.) Home Hodel Commercial Hodel Total unit cost Under ABC, prepare a schedule showing the computations of the activity based overhead rates (per cost driver) (Round overhead rate to 2 decial places, ee. 12.25) Activity Based Overhead Rate Estimated Use of Cost Estimated Activity Cost Pooli Overhead rivers Pounds per pound Receving per machine hour Machne hours forming 917 PM CALCULATOe PRINEER VERso Under ABC, prepare a schedule showing the computations of the activity-based overhead rates (per cost driver). (Round overhead rate to 2 decimal places, e.g. 12.25.) Estimated Overhead Estimated Use of Cost Drivers Activity Based Overhead Rate Activity Cost Pool Receiving Pounds per pound Forming Machine hours per machine hour Assembling Parts per part Testing Tests per test Painting Gallons per galon Packing and shippings Pounds per pound Prepare a schedule assigning each activity's overhead cost pool to each product based on the use of cost drivers. (Roumd overhead cost per unit to 2 decimal places, e.g. 12.25 and cost assigney decimal places, e.g. 2,500.) Commercial Model Estimated Use of Activy ates Cost Assigned Overhead Home Model Estimated Use of Activity Based Overhead Rates Cost Assigned Drivers Drivers Activity Cost Pool Receiving Forming Assembling Testing Panting ackino and shinninn CALCSATOR Forming RCES Assembling Testing 1-b2 Painting Packing and shipping b1-b2 Total costs assigned (a) Units produced (b) Study Overhead cost per unit [(a)+ (b) Compute the total cost per unit for each product under ABC. (Round answer to 2 decimal places e.q. 12.25.) Commercial Model Home Mode Total cost per unit Classidy each of the activities as a value added activity or a non-value-added activity. Activity Receiving Forming Assembling Testing Painting
