Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Real Cool produces two different models of alr conditioners. The company produces the mechanical systems in their components department. The mechanical systems are combined with

image text in transcribedimage text in transcribedimage text in transcribedimage text in transcribedimage text in transcribed

Real Cool produces two different models of alr conditioners. The company produces the mechanical systems in their components department. The mechanical systems are combined with the housing assembly In Its finishing department. The activities, costs, and drivers associated with these two manufacturing processes and the production support process follow. Process Activity Components Changeover Machining Setups Driver Number of batches Machine hours Number of setups Quantity 830 7,92e 140 Finishing Welding Inspecting Rework Overhead Cost $ 510,450 362,736 254,800 $1,127,986 $ 336,960 321,925 42,750 $ 701,635 $ 197,210 31,800 111,450 $ 340,460 Welding hours Number of inspections Rework orders 5, 2ee 815 190 Support Purchasing Providing space Providing utilities Purchase orders Number of units Number of units 533 7,5ee 7,500 Additional production Information concerning Its two product lines follows. Units produced Welding hours Batches Number of inspections Machine hours Setups Rework orders Purchase orders Model 145 2,500 1,600 415 475 2,650 70 90 355 Model 212 5,880 3,600 415 340 5,270 70 100 178 1. Using ABC, compute the overhead cost per unit for each product line. 2. Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $220 for Model 145 and $118 for Model 212. 3. Assume if the market price for Model 145 is $775 and the market price for Model 212 is $550, determine the profit or loss per unit for each model. Required 1 Required 2 Required 3 Using ABC, compute the overhead cost per unit for each product line. (Round your intermediate calculations, overhead rate, and activity rate answers to 2 decimal places.) Expected Costs Expected Activity Activity Rate $ S 510,450 362,736 254,800 830 Number of batches 7,920 Machine hours 140 Setups $ 615.00 per batch 45.80 per machine hour 1,820.00 per setup S Activity Components Changeover Machining Setups Finishing Welding Inspecting Rework Support Purchasing Providing space and utilities S S 336.960 321.925 5,200 Welding hours 815 Inspections 190 Rework hours S 64.80 per welding hour 395.00 per inspection 225.00 per rework order 42.750 $ S 197,210 $ 533 Purchase orders 7,500 Units 370.00 per purchase order 19.10 per unit 143,250 $ Model 145 --Activity rate Activity driver incurred Overhead assigned S 15,693,375 $ 615.00 per batch 45.80 per machine hour 1.820.00 per setup 255,225$ 121,370 127,400 5,558,746 $ 231,868,000 Components Changeover Machining Setups Finishing Welding Inspecting Rework Support Purchasing Providing space and utilities S $ 64.80 per welding hour 395.00 per inspection 225.00 per rework order 103,680 187,625 20,250 6,718,464 74,111,875 4,556,250 $ S 131,350 47,750 48,599,500 912,025 $ 370.00 per purchase order 19.10 per unit Total overhead cost Total units produced Overhead cost per unit S 388,018,235 2,500 $ 155,207.29 Model 212 -Activity rate Activity driver incurred Overhead assigned $ S 615.00 per batch 45.80 per machine hour 1,820.00 per setup S Components Changeover Machining Setups Finishing Welding Inspecting Rework Support Purchasing Providing space and utilities $ S 64.80 per welding hour 395.00 per inspection 225.00 per rework order S $ 370.00 per purchase order 19.10 per unit S Required 1 Required 2 Required 3 Determine the total cost per unit for each product line if the direct labor and direct materials costs per unit are $220 for Model 145 and $118 for Model 212. (Round your intermediate calculations and final answers to 2 decimal places.) Model 145 Model 212 Materials and Labor per unit Overhead per unit Total cost per unit S 0.00 S 0.00 Required 1 Required 2 Required 3 Assume if the market price for Model 145 is $775 and the market price for Model 212 is $550, determine the profit or loss per unit for each model. (Round your intermediate calculations and final answers to 2 decimal places.) Model 145 Model 212 Price per unit Cost per unit Profit (loss) per unit S 0.00 $ 0.00

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_2

Step: 3

blur-text-image_3

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

Sovereign Debt Crisis The New Normal And The Newly Poor

Authors: D. Chorafas

1st Edition

0230298400, 9780230298408

More Books

Students also viewed these Accounting questions

Question

What is the purpose of adjusted gross income?

Answered: 1 week ago

Question

Compare and contrast skills, knowledge, and interests.

Answered: 1 week ago