Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Question 2 (12 Marks) Shadow Awnings makes custom awnings for homes and businesses. The companyuses an activity-based costing system for its overhead costs. The companyhas

image text in transcribed

Question 2 (12 Marks) Shadow Awnings makes custom awnings for homes and businesses. The companyuses an activity-based costing system for its overhead costs. The companyhas provided the following data conceming its amual overhead costs and its activity cost pools Ovehead Costs: $150,000 $100,000 $250,000 Production overhead Office expense Total Distribution of resourece consumption: Activity Cost Pools Making Awnings 45% 8% Job Support Other 40% Total 100% Production overhead Office expense 15% 65 % 27% 100% The "Other" activity cost pool consists of the costs of idle capacity and organization-sustaining costs. The amount of activity for the year is as follows Annual Activity 5,000 metres Activity Cost Pool Making Awnings Job Support Other 200 jobs Not applicable Required a) Prepare the first-stage allocation of overhead costs to the activitycost pools byfilling in the table below (4 Marks): Making Awnings Job Support Other Iotal Production Overhead Office Expense Total b) Compute the activityrates (ie., cost perunit of activity) for the Making Awnings and Job Support activity cost pools by filling in the table below(3 Marks) Making Awnings Job Support Production Overhead Office Expense Total c) Prepare an income report in good form ofajob that involves making 80 meters of awnings and has direct materials and direct labour cost of $3,000. The sales revenue from this job is $4,000

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

Auditing Theory And Its Application

Authors: Hanson Arthur Warren, Arthur W. Hanson

1st Edition

1406753351, 978-1406753356

More Books

Students also viewed these Accounting questions

Question

1. Identify and control your anxieties

Answered: 1 week ago