St Clair Mgt Acctg Test 2 exam - 422C Costing Systems Microsoft Word Review ct 1 Normal 1 No Spaci... Heading 1 Heading 2 Title Paragraph Styles Overhead Cost per Costs Drivers Driver 2 Engineers 50,000 30 Design Machine set up Machine operations Shipment set up Distribution Administration 100,000 60,000 120,000 25,000 40,000 30,000 375,000 12 2,000 Set-Up hours 10,000 Machine hours 500 Shipments 10 #truck 5,000 Factory hours 5,000 Factory hours Drivers Produd 1 Produd 2 1 1 Engineers 1,500 500 Set-Up hours 6,500 3,500 ) Machine hours 300 200 Shipments 7 3 #trucks 2,500 2,500 Factory hours 50 4,000 6 Fadory overhead 75 200,000 100,000 TBD 30% Product Costs 250,000 Direct Material 75,000 Direct Labour TBD Overhead 15% Margin for Cost Plus Pricing Questions 1. What are the costs of the products using the simplified or traditional overhead method? 2. What are the costs of the products using the activity-based costing method? 3. What are two benefits of the simplified or traditional method? 4. What are two benefits of the activity-based costing method? 5. What is the impact on pricing if Product 1 is desired by customers? Should changes be made? o