Question
Two-Stage ABC for Manufacturing Meridian Company has determined its activity cost pools and cost drivers to be the following: Cost pools Setup $35,000 Material handling
Two-Stage ABC for Manufacturing
Meridian Company has determined its activity cost pools and cost drivers to be the following:
Cost pools
Setup
$35,000
Material handling
12,800
Machine operation
280,000
Packing
30,000
Total indirect manufacturing costs
$357,800
Cost drivers
Setups
350
Material moves
640
Machine hours
20,000
Packing orders
1,200
One product made by Meridian, metal casements, used the following activities during the period to produce 500 units:
Setups
20
Material moves
80
Machine hours
1,900
Packing orders
150
(a) Calculate the cost per unit of activity for each activity cost pool.
Setup
Answer
Material handling
Answer
Material operation
Answer
Packing
Answer
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Financial And Managerial Accounting
Authors: Charles T Horngren, Jr Walter T Harrison
2nd Edition
0135080193, 9780135080191
