Question
Sweet Sugar Company manufactures three products (white sugar, brown sugar, and powdered sugar) in a continuous production process. Senior management has asked the controller to
Sweet Sugar Company manufactures three products (white sugar, brown sugar, and powdered sugar) in a continuous production process. Senior management has asked the controller to conduct an activity-based costing study. The controller identified the amount of factory overhead required by the critical activities of the organization as follows:
1 | Activity | Budgeted Activity Cost |
2 | Production | $500,000.00 |
3 | Setup | 144,000.00 |
4 | Inspection | 44,000.00 |
5 | Shipping | 115,000.00 |
6 | Customer service | 84,000.00 |
7 | Total | $887,000.00 |
The activity bases identified for each activity are as follows:
Activity | Activity Base |
---|---|
Production | Machine hours |
Setup | Number of setups |
Inspection | Number of inspections |
Shipping | Number of customer orders |
Customer service | Number of customer service requests |
The activity-base usage quantities and units produced for the three products were determined from corporate records and are as follows:
Machine | Number of | Number of | Number of | Customer Service | ||
Hours | Setups | Inspections | Customer Orders | Requests | Units | |
White sugar | 5,000 | 85 | 220 | 1,150 | 60 | 10,000 |
Brown sugar | 2,500 | 170 | 330 | 2,600 | 350 | 5,000 |
Powdered sugar | 2,500 | 195 | 550 | 2,000 | 190 | 5,000 |
Total | 10,000 | 450 | 1,100 | 5,750 | 600 | 20,000 |
Each product requires 0.5 machine hour per unit.
Required: | |||||||
---|---|---|---|---|---|---|---|
Complete the Activity Tables for White sugar, Brown sugar, and Powdered sugar.
| |||||||
* If required, round all per-unit amounts to the nearest cent. |
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