Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Vandalay Industries manufactures two products: toasters and blenders. The annual production and sales of toasters is 2300 units, while 1400 units of blenders are produced

image text in transcribed
Vandalay Industries manufactures two products: toasters and blenders. The annual production and sales of toasters is 2300 units, while 1400 units of blenders are produced and sold. The company has traditionally used direct labor hours to allocate its overhead to products. Toasters require 1.25 direct labor hours per unit, while blonders require 1 direct labor hours per unit. The total estimated overhead for the period is $145,315. The company is looking at the possibility of changing to an activity-based costing system for its products. If the company used an activity based costing system, it would have the following three activity cost pools: Expected activity Estimated overhead Activity cost pool cost Toasters Blenders Total Setup costs $8585 235 batches 450 batches 685 batches Engineering costs $67,980 820 engineering 30 engineering hours 1650 engineering his Maintenance costs $68,750 2790 direct labor hours 1095 direct labor hours 3885 direct labor hours Total $2300 The cost pool activity rate for Engineering Costs would be closest to Round all answers to two decimal places) $41.20 per engineering hour. $12.53 per engineering hour. $62.08 per engineering hour. $17.70 per engineering hour OOOO

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

Step: 3

blur-text-image

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

Audit And Assurance Principles And Practices In Singapore

Authors: Dr Ernest Kan

5th Edition

9814838136, 978-9814838139

More Books

Students also viewed these Accounting questions