Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

She also determined the average order size for the Basic and Advanced models is 400 units and 50 units, respectively. The molding machines require

She also determined the average order size for the Basic and Advanced models is 400 units and 50 units, respectively. The molding machines require a setup for each order. One setup hour is required for each customer order of the Basic model and three hours are required to setup for an order of the Advanced model. The company pays a sales commissions of 5% for the Basic model and 10% for the Advanced model. Its traceable fixed advertising costs include $150,000 for the Basic model and $200,000 for the Advanced model. The remainder of the company's selling and administrative costs are organization-sustaining in nature. Using the additional Information provided by the production manager, calculate: a. An activity rate for each activity cost pool. b. The total manufacturing overhead cost allocated to the Basic model and the Advanced model using the activity-based approach. c. The total selling and administrative cost traced to the Basic model and the Advanced model using the activity-based approach. 4. Using your activity-based cost assignments from requirement 3, prepare a contribution format segmented income statement adapted from Exhibit 6-8. (Hint Organize all of the company's costs Into three categories: variable expenses, traceable fixed expenses, and common fixed expenses.) 5. Using your contribution format segmented Income statement from requirement 4, calculate the break-even point in dollar sales for the Advanced model. Answer is not complete. Complete this question by entering your answers in the tabs below. Required 1A Required 1B Required 2A Required 28 Required 2C Required 3A Required 38 Required 3C Required 4 Required 5 Using activity-based costing, calculate the total manufacturing overhead cost allocated to the Basic model and the Advanced model using the activity-based approach. Note: Round your intermediate calculations to 2 decimal places. Basic Advanced Machining S 12.000 S Assemble and pack 20,000 x 10.000 x 10,000x Order processing Setups 50 x 50 x 200 x 600 Total overhead cost assigned $ 32,100 20.800 < Required 3A Required 3C >

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

Accounting

Authors: Jonathan E. Duchac, James M. Reeve, Carl S. Warren

23rd Edition

978-0324662962

More Books

Students also viewed these Accounting questions

Question

What is a matrix structure? When would management use it?

Answered: 1 week ago

Question

Explain how religious attitudes affect firm behavior.

Answered: 1 week ago

Question

68. If ABA = kA for k 0, show that (1/k)B is a c-inverse of A.

Answered: 1 week ago