Using the following information what is the COGS using the Current Cost Allocation? m (3 Points) Thinkine Overhead Allocation Proposed Allocation Method e s Overhead cost pobl Material handling Machining Testing Total Overhead costs Think, Inc. was a really smart new accountant who wants to change the companies manufacturing overhead allocation from its current allocation to one based on the activity of the factory, the accountant wants you to help illustrate to the board of directors of Think, Inc. how this will change their profitability. The company currently prices their products at 45% more than their unit cost. The Accountant has estimated the unit Sales at the sales price of each unit Answer questions 8-12 based on the following information, Costa drivers actity level Allocation Rese of parts 40 000 300 per part MM 15.000 12.00 per MH ,000 4500 per TH OH Costa $ 120,000 $ 100,000 $ 129,000 $ 429,000 Cost Drivers Used by product Type of parts . of TH Type A 20,000 4,000 800 Type 12,000 5,000 700 Type C 8,000 6000 1500 Current Cost allocation To e Total Cost Total Activity 19500 Productos par ABC Units Direct material Direct Labor p 10.000 255 20 $ p .000 355 10 TOTAL 1.000 45 40 $ 429,000.0 $ 22 Per hour S 105 10 $ Type C 1.000 Maria Product costs as per TC Type A Type B Units 10.000 .000 DLH/unit Directorial S2500 $ 35.00 $ Director $20.00 $ 30.00 $ Manufacturing overhead (MOHS 22.00 $ 33.00 S $ 67.00 S 98.00 S 0.000 0 3.000.00 24,000.00 $ 120,000.00 000000000001573. DOIS 1000 $ 34 400 000 100 00 Is s ols 129 000 00 51.00.00 5126100.00 16.500.00 S 429.000.00 TES TO FOH TRUE 45.00 40.00 4400 129.00 1424 S 2 IS S O Sales Price per unit $ Sales Price Per unit Est. Sales at Price per unit $ 97.15 7,000 $ 142 10 $ 4.000 187.05 1000 85.90 $ 9.000 130.82 $ 5.000 35598 800 O A. $196,400 OB. $990,000 C. $1,435,500 O $1,107,010 Using the information from #8. What is the COGS using the proposed activity based allocation method (3 Points) O A. $196,400 OB. 5990,000 O C. $1,435,500 O D. $1,107,010 Think inc. Overhead Allocation Proposed Allocation Method Overhead cost pool/activities Material handling Machining Testing Total Overhead costs Think, Inc. Has a really smart new accountant who wants to change the companies manufacturing overhead allocation from its current allocation to one based on the activity of the factory. the accountant wants you to help illustrate to the board of directors of Think, Inc. how this will change their profitability. The company currently prices their products at 45% more than their unit cost. The Accountant has estimated the unit Sales at the sales price of each unit. Answer questions 8-12 based on the following information. S $ Is OH Costs 120,000 180,000 129,000 429,000 Costs drivers # of parts # of MH # of TH 1 activity level 40,000 15,000 3 ,000 S $ S Allocation Rate 3.00 12.00 43.00 per part per MH per TH | $ Cost Drivers Used by product Type # of parts # of MH Type A 20,000 4,000 800 Type B 12,000 5,000 700 Type C 8,000 6,000 1,500 # of TH Current Cost allocation Type A | Type B Type C TOTAL Total Cost = 5 Total Activity 19500 PFOR 22 Per hour 429,000.0 $ 10,000 L 25 20 Is Is ,000 35 30 Is s 1 1,000 45 40 s s Is IS 105 90 Type A 10,000 Product costs as per TC Units DLH/unit Direct material Direct Labor Manufacturing overhead (MOH) Unit cost 1.0 Product costs as per ABC Units Direct material Direct Labor FOH Material handling Machining Testing Total FOH Total FOH/unit Unit cost Type B 5,000 1.5 35.00 30.00 33.00 98.00 Type C 1,000 2.0 45.00 40.00 44.00 129.00 $ 25.00 $ 20.00 $ 22.00 $ 67.00 $ $ $ $ $ $ S $ is 60,000.00 48,000.00 34,400.00 142,400.00 14.24 5 9.24 $ $ $ $ $ $ S $ S $ $ $ $ 36,000.00 $ 60,000.00 $ 30,100.00 S 126,100.00 $ 25.22 $ 90.220 120,000.00 180,000.00 129,000.00 429,000.00 24,000.00 72,000.00 64,500.00 160,500.00 160.50 245.50 TRUE 1 Sales Figures Sales Price Per unit Est. Sales at Price per unit $ $ $ $ 97.15 7,000 $ Sales Figures Sales Price Per unit Sales in units 142.10 4,000 187.05 1,000 85.90 9,000 130.82 5,000 355.98 800 COGS 533,160 451,100 196,400 1,180,660