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right answer please Krypton Inc. manufactures two products, Vintex and Bromal. The company estimated it would incur $160,690 in manufacturing overhead costs during the curent
right answer please
Krypton Inc. manufactures two products, Vintex and Bromal. The company estimated it would incur $160,690 in manufacturing overhead costs during the curent period. Overhead currently is applied to the products on the basis of direct labour hours. Data concerning the current period's operations appear below. Estimated Volume Direct labour hours per unit Direct labour cost per unit Direct material cost per unit Vintex 4,700 units 2.1 hours $33.60 $4.80 Bromal 3,300 units 1.6 hours $25.60 $12.70 The company is considering using an activity-based costing system to compute unit product costs instead of its traditional single plant-wide system based on direct labour hours. The activity- based costing system would use three activity cost pools and drivers: Activity cost pool Material acquisition costs Machine costs General factory costs Driver Purchase orders Machine setups Direct labour hours Data relating to these activities for the cuirent period are given below: Estimated Activity cost pool overhead costs Material acquisition costs $78,800 Machine costs $12.490 Expected driver activity levels Vintex Bromal Total 920 730 1650 150 SO 230 Tvaterai acqUSTOU COSUS Machine costs General factory costs TUTASU URES Machine setups Direct labour hours Data relating to these activities for the current period are given below: Estimated Activity cost pool overhead costs Material acquisition costs $78,800 Machine costs $12,490 General factory costs $69,400 Expected driver activity levels Vintex Bromal Total 920 730 1650 150 80 230 9,870 5.280 15.150 Required: a) Compute the predetermined overhead rate under the single plant-wide method and determine the unit product cost of each product for the current year. b) Determine the unit product cost of each product for the curent period using the activity- based costing approach. c) Which method will probably provide a better representation of init cost? Explain brieflyStep by Step Solution
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