Q1.Rubin Robe runs a factory making bathrobes for hotel guest use.

The total indirect costs for the year ended 30thJune are $720 000

Total direct labour hours for the current period are 24 000

Total machine hours for the current period is 30 000

1. The indirect cost rate for the business if the business allocates overheads using direct labour hours:

30 per machine hour

30 per labour hour

24 per machine hour

24 per labour hour

2. The indirect cost rate for the business isif the business allocates overheads using machine hours:

30 per machine hour

30 per labour hour

24 per machine hour

24 per labour hour

Q2.Rubin Robe runs a factory making bathrobes for hotel guest use.Rubin's business allocates overheads using machine hours. The indirect cost rate is $24 per machine hour.

If one bathrobe requires the following:

-$75 direct materials

-4 direct labour hours ($15 direct labour rate)

-7 machine hours

3.What is the value of the allocated overheads of one bathrobe?

120 303 168 255

4.What is the full cost of one bathrobe?

120 303 168 255

Q3.Rubin Robe runs a factory making bathrobes for hotel guest use.Rubin's business allocates overheads using labour hours. The indirect cost rate is $30 per direct labour hour.

If one bathrobe requires the following:

-$75 direct materials

-4 direct labour hours ($15 direct labour rate)

-7 machine hours

5.What is the value of the allocated overheads of one bathrobe?

120 303 168 255

6.What is the full cost of one bathrobe?

120 303 168 255

Q4.The steps involved in determining the full cost of a cost object are listed below (in no particular order).

A

determine the indirect cost rate for each cost pool

B

identify the cost driver to be used

C

identify the indirect cost to be allocated to the cost object

D

total all indirect costs

E

determine the full cost of the cost object

7. Thecorrectorder for carrying out these steps is:

DCBAE

CBDAE

CDBAE

BCADE

Q5.Rubin Robe runs a factory making bathrobes for hotel guest use.

The list below provides costs at the factory:

- Factory electricity expense

- Factory supervisor's salary expense

- Repairs and maintenance of factory machines

8.For costing calculations how would you classify them?

Direct costs

Indirect costs

Expenses

payables

Q6.Rubin Robes runs a factory making bathrobes for hotel guest use.

The list below provides costs at the factory:

- Purchase of material for bathrobes

- Purchase of belts for bathrobes

- Casual wages expense to person making bathrobes

9.For costing calculations how would you classify them?

Direct costs

Indirect costs

Expenses

payables

Q7.Rubin Robes runs a factory making bathrobes for guest use.

If the full cost of a bathrobe was $200 and the cost-based pricing was used with a 60% markup.

10. What would the selling price be?

320 120 440 400