Question
Required information [The following information applies to the questions displayed below.] Rustafson Corporation is a diversified manufacturer of consumer goods. The company's activity-based costing system
Required information
[The following information applies to the questions displayed below.]
Rustafson Corporation is a diversified manufacturer of consumer goods. The company's activity-based costing system has the following seven activity cost pools:
| Activity Cost Pool | Estimated Overhead Cost | Expected Activity | |||
| Labor-related | $ | 28,000 | 5,000 | direct labor-hours | |
| Machine-related | $ | 2,500 | 5,000 | machine-hours | |
| Machine setups | $ | 34,300 | 700 | setups | |
| Production orders | $ | 13,800 | 300 | orders | |
| Product testing | $ | 12,000 | 600 | tests | |
| Packaging | $ | 57,000 | 3,800 | packages | |
| General factory | $ | 60,000 | 5,000 | direct labor-hours | |
| Activity Cost Pool | Activity Rate | |||
| Labor-related | $ | per DLH | ||
| Machine-related | $ | per MH | ||
| Machine setups | $ | per setup | ||
| Production orders | $ | per order | ||
| Product testing | $ | per test | ||
| Packaging | $ | per package | ||
| General factory | $ | per DLH | ||
2.
Required information
[The following information applies to the questions displayed below.]
Rustafson Corporation is a diversified manufacturer of consumer goods. The company's activity-based costing system has the following seven activity cost pools:
| Activity Cost Pool | Estimated Overhead Cost | Expected Activity | |||
| Labor-related | $ | 28,000 | 5,000 | direct labor-hours | |
| Machine-related | $ | 2,500 | 5,000 | machine-hours | |
| Machine setups | $ | 34,300 | 700 | setups | |
| Production orders | $ | 13,800 | 300 | orders | |
| Product testing | $ | 12,000 | 600 | tests | |
| Packaging | $ | 57,000 | 3,800 | packages | |
| General factory | $ | 60,000 | 5,000 | direct labor-hours | |
Compute the company's predetermined overhead rate, assuming that the company uses a single plantwide predetermined overhead rate based on direct labor-hours.
3.
Larner Corporation is a diversified manufacturer of industrial goods. The company's activity-based costing system contains the following six activity cost pools and activity rates:
| Activity Cost Pool | Activity Rates | ||
| Labor-related | $ | 7.00 | per direct labor-hour |
| Machine-related | $ | 7.00 | per machine-hour |
| Machine setups | $ | 30.00 | per setup |
| Production orders | $ | 200.00 | per order |
| Shipments | $ | 140.00 | per shipment |
| General factory | $ | 7.00 | per direct labor-hour |
Cost and activity data have been supplied for the following products:
| J78 | B52 | ||||||
| Direct materials cost per unit | $ | 5.50 | $ | 32.00 | |||
| Direct labor cost per unit | $ | 4.75 | $ | 9.00 | |||
| Number of units produced per year | 4,000 | 100 | |||||
| Total Expected Activity | ||||||
| J78 | B52 | |||||
| Direct labor-hours | 1,200 | 30 | ||||
| Machine-hours | 2,200 | 50 | ||||
| Machine setups | 6 | 1 | ||||
| Production orders | 5 | 1 | ||||
| Shipments | 7 | 1 | ||||
Required:
Compute the unit product cost of each product listed above. (Do not round intermediate calculations. Round your answers to 2 decimal places.)
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Financial Accounting
Authors: Robert Libby, Patricia Libby, Frank Hodge
11th Edition
1264229739, 9781264229734
